Correlation Between Cofinimmo and Retail Estates
Can any of the company-specific risk be diversified away by investing in both Cofinimmo and Retail Estates 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 Retail Estates into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Cofinimmo SA and Retail Estates , you can compare the effects of market volatilities on Cofinimmo and Retail Estates 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 Retail Estates. Check out your portfolio center. Please also check ongoing floating volatility patterns of Cofinimmo and Retail Estates.
Diversification Opportunities for Cofinimmo and Retail Estates
0.95 | Correlation Coefficient |
Almost no diversification
The 3 months correlation between Cofinimmo and Retail is 0.95. Overlapping area represents the amount of risk that can be diversified away by holding Cofinimmo SA and Retail Estates in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Retail Estates 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 Retail Estates. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Retail Estates has no effect on the direction of Cofinimmo i.e., Cofinimmo and Retail Estates go up and down completely randomly.
Pair Corralation between Cofinimmo and Retail Estates
Assuming the 90 days trading horizon Cofinimmo SA is expected to under-perform the Retail Estates. In addition to that, Cofinimmo is 1.22 times more volatile than Retail Estates . It trades about -0.02 of its total potential returns per unit of risk. Retail Estates is currently generating about 0.02 per unit of volatility. If you would invest 5,480 in Retail Estates on August 25, 2024 and sell it today you would earn a total of 470.00 from holding Retail Estates or generate 8.58% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Cofinimmo SA vs. Retail Estates
Performance |
| Timeline |
| Cofinimmo SA |
| Retail Estates |
Cofinimmo and Retail Estates Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Cofinimmo and Retail Estates
The main advantage of trading using opposite Cofinimmo and Retail Estates positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Cofinimmo position performs unexpectedly, Retail Estates 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 Retail Estates will offset losses from the drop in Retail Estates' long position.| Cofinimmo vs. Home Invest Belgium | Cofinimmo vs. Wereldhav B Sicafi | Cofinimmo vs. Retail Estates | Cofinimmo vs. Exmar NV |
| Retail Estates vs. Cofinimmo SA | Retail Estates vs. Warehouses de Pauw | Retail Estates vs. Montea CVA | Retail Estates vs. Aedifica |
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 Money Managers module to screen money managers from public funds and ETFs managed around the world.
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