Correlation Between Alstria Office and HEINEKEN
Can any of the company-specific risk be diversified away by investing in both Alstria Office and HEINEKEN at the same time? Although using a correlation coefficient on its own may not help to predict future stock returns, this module helps to understand the diversifiable risk of combining Alstria Office and HEINEKEN into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between alstria office REIT AG and HEINEKEN SP ADR, you can compare the effects of market volatilities on Alstria Office and HEINEKEN and check how they will diversify away market risk if combined in the same portfolio for a given time horizon. You can also utilize pair trading strategies of matching a long position in Alstria Office with a short position of HEINEKEN. Check out your portfolio center. Please also check ongoing floating volatility patterns of Alstria Office and HEINEKEN.
Diversification Opportunities for Alstria Office and HEINEKEN
0.35 | Correlation Coefficient |
Weak diversification
The 3 months correlation between Alstria and HEINEKEN is 0.35. Overlapping area represents the amount of risk that can be diversified away by holding alstria office REIT AG and HEINEKEN SP ADR in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on HEINEKEN SP ADR and Alstria Office is a relative statistical measure of the degree to which these equity instruments tend to move together. The correlation coefficient measures the extent to which returns on alstria office REIT AG are associated (or correlated) with HEINEKEN. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of HEINEKEN SP ADR has no effect on the direction of Alstria Office i.e., Alstria Office and HEINEKEN go up and down completely randomly.
Pair Corralation between Alstria Office and HEINEKEN
Assuming the 90 days horizon alstria office REIT AG is expected to generate 0.76 times more return on investment than HEINEKEN. However, alstria office REIT AG is 1.32 times less risky than HEINEKEN. It trades about 0.05 of its potential returns per unit of risk. HEINEKEN SP ADR is currently generating about -0.12 per unit of risk. If you would invest 546.00 in alstria office REIT AG on November 3, 2024 and sell it today you would earn a total of 6.00 from holding alstria office REIT AG or generate 1.1% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
alstria office REIT AG vs. HEINEKEN SP ADR
Performance |
| Timeline |
| alstria office REIT |
| HEINEKEN SP ADR |
Alstria Office and HEINEKEN Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Alstria Office and HEINEKEN
The main advantage of trading using opposite Alstria Office and HEINEKEN positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Alstria Office position performs unexpectedly, HEINEKEN can make up some of the losses. Pair trading also minimizes risk from directional movements in the market. For example, if an entire industry or sector drops because of unexpected headlines, the short position in HEINEKEN will offset losses from the drop in HEINEKEN's long position.| Alstria Office vs. Digital Realty Trust | Alstria Office vs. Gecina SA | Alstria Office vs. Japan Real Estate | Alstria Office vs. Mirvac Group |
| HEINEKEN vs. VARIOUS EATERIES LS | HEINEKEN vs. CHRYSALIS INVESTMENTS LTD | HEINEKEN vs. Apollo Investment Corp | HEINEKEN vs. PennantPark Investment |
Check out your portfolio center.Note that this page's information should be used as a complementary analysis to find the right mix of equity instruments to add to your existing portfolios or create a brand new portfolio. You can also try the Portfolio Optimization module to compute new portfolio that will generate highest expected return given your specified tolerance for risk.
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