Correlation Between Inmobiliaria Colonial and Mercal Inmuebles
Can any of the company-specific risk be diversified away by investing in both Inmobiliaria Colonial and Mercal Inmuebles 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 Inmobiliaria Colonial and Mercal Inmuebles into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Inmobiliaria Colonial SA and Mercal Inmuebles Socimi, you can compare the effects of market volatilities on Inmobiliaria Colonial and Mercal Inmuebles 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 Inmobiliaria Colonial with a short position of Mercal Inmuebles. Check out your portfolio center. Please also check ongoing floating volatility patterns of Inmobiliaria Colonial and Mercal Inmuebles.
Diversification Opportunities for Inmobiliaria Colonial and Mercal Inmuebles
-0.77 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between Inmobiliaria and Mercal is -0.77. Overlapping area represents the amount of risk that can be diversified away by holding Inmobiliaria Colonial SA and Mercal Inmuebles Socimi in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Mercal Inmuebles Socimi and Inmobiliaria Colonial 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 Inmobiliaria Colonial SA are associated (or correlated) with Mercal Inmuebles. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Mercal Inmuebles Socimi has no effect on the direction of Inmobiliaria Colonial i.e., Inmobiliaria Colonial and Mercal Inmuebles go up and down completely randomly.
Pair Corralation between Inmobiliaria Colonial and Mercal Inmuebles
Assuming the 90 days trading horizon Inmobiliaria Colonial is expected to generate 64.29 times less return on investment than Mercal Inmuebles. But when comparing it to its historical volatility, Inmobiliaria Colonial SA is 1.59 times less risky than Mercal Inmuebles. It trades about 0.0 of its potential returns per unit of risk. Mercal Inmuebles Socimi is currently generating about 0.03 of returns per unit of risk over similar time horizon. If you would invest 4,202 in Mercal Inmuebles Socimi on September 13, 2024 and sell it today you would earn a total of 718.00 from holding Mercal Inmuebles Socimi or generate 17.09% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 58.42% |
| Values | Daily Returns |
Inmobiliaria Colonial SA vs. Mercal Inmuebles Socimi
Performance |
| Timeline |
| Inmobiliaria Colonial |
| Mercal Inmuebles Socimi |
Inmobiliaria Colonial and Mercal Inmuebles Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Inmobiliaria Colonial and Mercal Inmuebles
The main advantage of trading using opposite Inmobiliaria Colonial and Mercal Inmuebles positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Inmobiliaria Colonial position performs unexpectedly, Mercal Inmuebles 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 Mercal Inmuebles will offset losses from the drop in Mercal Inmuebles' long position.| Inmobiliaria Colonial vs. Merlin Properties SOCIMI | Inmobiliaria Colonial vs. Ferrovial | Inmobiliaria Colonial vs. Bankinter | Inmobiliaria Colonial vs. Acerinox |
| Mercal Inmuebles vs. Merlin Properties SOCIMI | Mercal Inmuebles vs. Inmobiliaria Colonial SA | Mercal Inmuebles vs. Cia de Distribucion | Mercal Inmuebles vs. ENCE Energa y |
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 Equity Forecasting module to use basic forecasting models to generate price predictions and determine price momentum.
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