Correlation Between Chiba Bank and Alstria Office
Can any of the company-specific risk be diversified away by investing in both Chiba Bank and Alstria Office 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 Chiba Bank and Alstria Office into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Chiba Bank and alstria office REIT AG, you can compare the effects of market volatilities on Chiba Bank and Alstria Office 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 Chiba Bank with a short position of Alstria Office. Check out your portfolio center. Please also check ongoing floating volatility patterns of Chiba Bank and Alstria Office.
Diversification Opportunities for Chiba Bank and Alstria Office
0.27 | Correlation Coefficient |
Modest diversification
The 3 months correlation between Chiba and Alstria is 0.27. Overlapping area represents the amount of risk that can be diversified away by holding Chiba Bank and alstria office REIT AG in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on alstria office REIT and Chiba Bank 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 Chiba Bank are associated (or correlated) with Alstria Office. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of alstria office REIT has no effect on the direction of Chiba Bank i.e., Chiba Bank and Alstria Office go up and down completely randomly.
Pair Corralation between Chiba Bank and Alstria Office
Assuming the 90 days horizon Chiba Bank is expected to generate 0.44 times more return on investment than Alstria Office. However, Chiba Bank is 2.29 times less risky than Alstria Office. It trades about 0.15 of its potential returns per unit of risk. alstria office REIT AG is currently generating about -0.03 per unit of risk. If you would invest 660.00 in Chiba Bank on October 26, 2024 and sell it today you would earn a total of 105.00 from holding Chiba Bank or generate 15.91% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Chiba Bank vs. alstria office REIT AG
Performance |
| Timeline |
| Chiba Bank |
| alstria office REIT |
Chiba Bank and Alstria Office Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Chiba Bank and Alstria Office
The main advantage of trading using opposite Chiba Bank and Alstria Office positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Chiba Bank position performs unexpectedly, Alstria Office 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 Alstria Office will offset losses from the drop in Alstria Office's long position.| Chiba Bank vs. Synovus Financial Corp | Chiba Bank vs. Corporate Office Properties | Chiba Bank vs. KENEDIX OFFICE INV | Chiba Bank vs. Infrastrutture Wireless Italiane |
| Alstria Office vs. Meta Financial Group | Alstria Office vs. Easy Software AG | Alstria Office vs. Discover Financial Services | Alstria Office vs. Chiba Bank |
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 Global Markets Map module to get a quick overview of global market snapshot using zoomable world map. Drill down to check world indexes.
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