Correlation Between Banque Nationale and Home Invest
Can any of the company-specific risk be diversified away by investing in both Banque Nationale and Home Invest 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 Banque Nationale and Home Invest into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Banque nationale de and Home Invest Belgium, you can compare the effects of market volatilities on Banque Nationale and Home Invest 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 Banque Nationale with a short position of Home Invest. Check out your portfolio center. Please also check ongoing floating volatility patterns of Banque Nationale and Home Invest.
Diversification Opportunities for Banque Nationale and Home Invest
-0.81 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between Banque and Home is -0.81. Overlapping area represents the amount of risk that can be diversified away by holding Banque nationale de and Home Invest Belgium in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Home Invest Belgium and Banque Nationale 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 Banque nationale de are associated (or correlated) with Home Invest. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Home Invest Belgium has no effect on the direction of Banque Nationale i.e., Banque Nationale and Home Invest go up and down completely randomly.
Pair Corralation between Banque Nationale and Home Invest
Assuming the 90 days trading horizon Banque nationale de is expected to under-perform the Home Invest. In addition to that, Banque Nationale is 1.42 times more volatile than Home Invest Belgium. It trades about -0.52 of its total potential returns per unit of risk. Home Invest Belgium is currently generating about 0.29 per unit of volatility. If you would invest 1,700 in Home Invest Belgium on November 9, 2024 and sell it today you would earn a total of 148.00 from holding Home Invest Belgium or generate 8.71% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Banque nationale de vs. Home Invest Belgium
Performance |
| Timeline |
| Banque nationale |
| Home Invest Belgium |
Banque Nationale and Home Invest Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Banque Nationale and Home Invest
The main advantage of trading using opposite Banque Nationale and Home Invest positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Banque Nationale position performs unexpectedly, Home Invest 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 Home Invest will offset losses from the drop in Home Invest's long position.| Banque Nationale vs. GIMV NV | Banque Nationale vs. Sofina Socit Anonyme | Banque Nationale vs. Groep Brussel Lambert | Banque Nationale vs. Tubize Fin |
| Home Invest vs. Cofinimmo SA | Home Invest vs. Care Property Invest | Home Invest vs. Aedifica | Home Invest vs. Montea CVA |
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 Competition Analyzer module to analyze and compare many basic indicators for a group of related or unrelated entities.
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