Correlation Between Alstria Office and SCOR SE
Can any of the company-specific risk be diversified away by investing in both Alstria Office and SCOR SE 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 SCOR SE 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 SCOR SE, you can compare the effects of market volatilities on Alstria Office and SCOR SE 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 SCOR SE. Check out your portfolio center. Please also check ongoing floating volatility patterns of Alstria Office and SCOR SE.
Diversification Opportunities for Alstria Office and SCOR SE
0.46 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Alstria and SCOR is 0.46. Overlapping area represents the amount of risk that can be diversified away by holding alstria office REIT AG and SCOR SE in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on SCOR SE 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 SCOR SE. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of SCOR SE has no effect on the direction of Alstria Office i.e., Alstria Office and SCOR SE go up and down completely randomly.
Pair Corralation between Alstria Office and SCOR SE
Assuming the 90 days horizon alstria office REIT AG is expected to under-perform the SCOR SE. In addition to that, Alstria Office is 5.27 times more volatile than SCOR SE. It trades about -0.21 of its total potential returns per unit of risk. SCOR SE is currently generating about 0.09 per unit of volatility. If you would invest 2,440 in SCOR SE on October 11, 2024 and sell it today you would earn a total of 46.00 from holding SCOR SE or generate 1.89% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
alstria office REIT AG vs. SCOR SE
Performance |
| Timeline |
| alstria office REIT |
| SCOR SE |
Alstria Office and SCOR SE Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Alstria Office and SCOR SE
The main advantage of trading using opposite Alstria Office and SCOR SE positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Alstria Office position performs unexpectedly, SCOR SE 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 SCOR SE will offset losses from the drop in SCOR SE's long position.| Alstria Office vs. Canadian Utilities Limited | Alstria Office vs. Algonquin Power Utilities | Alstria Office vs. UNITED RENTALS | Alstria Office vs. United Breweries Co |
| SCOR SE vs. alstria office REIT AG | SCOR SE vs. KENEDIX OFFICE INV | SCOR SE vs. Charter Communications | SCOR SE vs. MAVEN WIRELESS SWEDEN |
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 Risk-Return Analysis module to view associations between returns expected from investment and the risk you assume.
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