Correlation Between Cofinimmo and Immobel
Can any of the company-specific risk be diversified away by investing in both Cofinimmo and Immobel 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 Immobel into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Cofinimmo SA and Immobel, you can compare the effects of market volatilities on Cofinimmo and Immobel 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 Immobel. Check out your portfolio center. Please also check ongoing floating volatility patterns of Cofinimmo and Immobel.
Diversification Opportunities for Cofinimmo and Immobel
Very good diversification
The 3 months correlation between Cofinimmo and Immobel is -0.38. Overlapping area represents the amount of risk that can be diversified away by holding Cofinimmo SA and Immobel in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Immobel 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 Immobel. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Immobel has no effect on the direction of Cofinimmo i.e., Cofinimmo and Immobel go up and down completely randomly.
Pair Corralation between Cofinimmo and Immobel
Assuming the 90 days trading horizon Cofinimmo SA is expected to generate 1.12 times more return on investment than Immobel. However, Cofinimmo is 1.12 times more volatile than Immobel. It trades about -0.07 of its potential returns per unit of risk. Immobel is currently generating about -0.16 per unit of risk. If you would invest 5,565 in Cofinimmo SA on November 4, 2024 and sell it today you would lose (120.00) from holding Cofinimmo SA or give up 2.16% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 95.45% |
| Values | Daily Returns |
Cofinimmo SA vs. Immobel
Performance |
| Timeline |
| Cofinimmo SA |
| Immobel |
Cofinimmo and Immobel Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Cofinimmo and Immobel
The main advantage of trading using opposite Cofinimmo and Immobel positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Cofinimmo position performs unexpectedly, Immobel 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 Immobel will offset losses from the drop in Immobel's long position.| Cofinimmo vs. Aedifica | Cofinimmo vs. Warehouses de Pauw | Cofinimmo vs. Groep Brussel Lambert | Cofinimmo vs. Ackermans Van Haaren |
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 Portfolio Optimization module to compute new portfolio that will generate highest expected return given your specified tolerance for risk.
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