Correlation Between Capital Counties and WFD Unibail
Can any of the company-specific risk be diversified away by investing in both Capital Counties and WFD Unibail 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 Capital Counties and WFD Unibail into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Capital Counties Properties and WFD Unibail Rodamco, you can compare the effects of market volatilities on Capital Counties and WFD Unibail 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 Capital Counties with a short position of WFD Unibail. Check out your portfolio center. Please also check ongoing floating volatility patterns of Capital Counties and WFD Unibail.
Diversification Opportunities for Capital Counties and WFD Unibail
0.61 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Capital and WFD is 0.61. Overlapping area represents the amount of risk that can be diversified away by holding Capital Counties Properties and WFD Unibail Rodamco in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on WFD Unibail Rodamco and Capital Counties 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 Capital Counties Properties are associated (or correlated) with WFD Unibail. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of WFD Unibail Rodamco has no effect on the direction of Capital Counties i.e., Capital Counties and WFD Unibail go up and down completely randomly.
Pair Corralation between Capital Counties and WFD Unibail
Assuming the 90 days horizon Capital Counties Properties is expected to under-perform the WFD Unibail. In addition to that, Capital Counties is 1.11 times more volatile than WFD Unibail Rodamco. It trades about -0.03 of its total potential returns per unit of risk. WFD Unibail Rodamco is currently generating about 0.07 per unit of volatility. If you would invest 7,226 in WFD Unibail Rodamco on September 13, 2024 and sell it today you would earn a total of 162.00 from holding WFD Unibail Rodamco or generate 2.24% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Capital Counties Properties vs. WFD Unibail Rodamco
Performance |
| Timeline |
| Capital Counties Pro |
| WFD Unibail Rodamco |
Capital Counties and WFD Unibail Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Capital Counties and WFD Unibail
The main advantage of trading using opposite Capital Counties and WFD Unibail positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Capital Counties position performs unexpectedly, WFD Unibail 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 WFD Unibail will offset losses from the drop in WFD Unibail's long position.| Capital Counties vs. URW EO 05 | Capital Counties vs. FREY EO 250 | Capital Counties vs. SERITAGE GWTH PRA |
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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 Competition Analyzer module to analyze and compare many basic indicators for a group of related or unrelated entities.
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