Correlation Between Cofinimmo and Banimmo SA
Can any of the company-specific risk be diversified away by investing in both Cofinimmo and Banimmo SA 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 Cofinimmo and Banimmo SA into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Cofinimmo SA and Banimmo SA, you can compare the effects of market volatilities on Cofinimmo and Banimmo SA 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 Cofinimmo with a short position of Banimmo SA. Check out your portfolio center. Please also check ongoing floating volatility patterns of Cofinimmo and Banimmo SA.
Diversification Opportunities for Cofinimmo and Banimmo SA
0.83 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between Cofinimmo and Banimmo is 0.83. Overlapping area represents the amount of risk that can be diversified away by holding Cofinimmo SA and Banimmo SA in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Banimmo SA and Cofinimmo 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 Cofinimmo SA are associated (or correlated) with Banimmo SA. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Banimmo SA has no effect on the direction of Cofinimmo i.e., Cofinimmo and Banimmo SA go up and down completely randomly.
Pair Corralation between Cofinimmo and Banimmo SA
Assuming the 90 days trading horizon Cofinimmo SA is expected to under-perform the Banimmo SA. But the stock apears to be less risky and, when comparing its historical volatility, Cofinimmo SA is 1.01 times less risky than Banimmo SA. The stock trades about -0.28 of its potential returns per unit of risk. The Banimmo SA is currently generating about -0.16 of returns per unit of risk over similar time horizon. If you would invest 326.00 in Banimmo SA on September 12, 2024 and sell it today you would lose (36.00) from holding Banimmo SA or give up 11.04% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Strong |
| Accuracy | 98.46% |
| Values | Daily Returns |
Cofinimmo SA vs. Banimmo SA
Performance |
| Timeline |
| Cofinimmo SA |
| Banimmo SA |
Cofinimmo and Banimmo SA Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Cofinimmo and Banimmo SA
The main advantage of trading using opposite Cofinimmo and Banimmo SA positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Cofinimmo position performs unexpectedly, Banimmo SA 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 Banimmo SA will offset losses from the drop in Banimmo SA's long position.| Cofinimmo vs. Aedifica | Cofinimmo vs. Warehouses de Pauw | Cofinimmo vs. Groep Brussel Lambert | Cofinimmo vs. Ackermans Van Haaren |
| Banimmo SA vs. Atenor SA | Banimmo SA vs. Immobel | Banimmo SA vs. EVS Broadcast Equipment | Banimmo SA vs. Home Invest Belgium |
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 Premium Stories module to follow Macroaxis premium stories from verified contributors across different equity types, categories and coverage scope.
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