Correlation Between Baloise Holding and Realstone Swiss
Can any of the company-specific risk be diversified away by investing in both Baloise Holding and Realstone Swiss 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 Baloise Holding and Realstone Swiss into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Baloise Holding AG and Realstone Swiss Property, you can compare the effects of market volatilities on Baloise Holding and Realstone Swiss 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 Baloise Holding with a short position of Realstone Swiss. Check out your portfolio center. Please also check ongoing floating volatility patterns of Baloise Holding and Realstone Swiss.
Diversification Opportunities for Baloise Holding and Realstone Swiss
-0.74 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between Baloise and Realstone is -0.74. Overlapping area represents the amount of risk that can be diversified away by holding Baloise Holding AG and Realstone Swiss Property in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Realstone Swiss Property and Baloise Holding 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 Baloise Holding AG are associated (or correlated) with Realstone Swiss. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Realstone Swiss Property has no effect on the direction of Baloise Holding i.e., Baloise Holding and Realstone Swiss go up and down completely randomly.
Pair Corralation between Baloise Holding and Realstone Swiss
Assuming the 90 days trading horizon Baloise Holding AG is expected to under-perform the Realstone Swiss. But the stock apears to be less risky and, when comparing its historical volatility, Baloise Holding AG is 1.93 times less risky than Realstone Swiss. The stock trades about -0.34 of its potential returns per unit of risk. The Realstone Swiss Property is currently generating about 0.38 of returns per unit of risk over similar time horizon. If you would invest 13,800 in Realstone Swiss Property on September 24, 2024 and sell it today you would earn a total of 950.00 from holding Realstone Swiss Property or generate 6.88% return on investment over 90 days.
Time Period | 3 Months [change] |
Direction | Moves Against |
Strength | Weak |
Accuracy | 100.0% |
Values | Daily Returns |
Baloise Holding AG vs. Realstone Swiss Property
Performance |
Timeline |
Baloise Holding AG |
Realstone Swiss Property |
Baloise Holding and Realstone Swiss Volatility Contrast
Predicted Return Density |
Returns |
Pair Trading with Baloise Holding and Realstone Swiss
The main advantage of trading using opposite Baloise Holding and Realstone Swiss positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Baloise Holding position performs unexpectedly, Realstone Swiss 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 Realstone Swiss will offset losses from the drop in Realstone Swiss' long position.Baloise Holding vs. Swiss Life Holding | ||
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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 Commodity Channel module to use Commodity Channel Index to analyze current equity momentum.
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