Correlation Between Care Property and Aedifica
Can any of the company-specific risk be diversified away by investing in both Care Property and Aedifica 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 Care Property and Aedifica into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Care Property Invest and Aedifica, you can compare the effects of market volatilities on Care Property and Aedifica 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 Care Property with a short position of Aedifica. Check out your portfolio center. Please also check ongoing floating volatility patterns of Care Property and Aedifica.
Diversification Opportunities for Care Property and Aedifica
0.66 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Care and Aedifica is 0.66. Overlapping area represents the amount of risk that can be diversified away by holding Care Property Invest and Aedifica in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Aedifica and Care Property 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 Care Property Invest are associated (or correlated) with Aedifica. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Aedifica has no effect on the direction of Care Property i.e., Care Property and Aedifica go up and down completely randomly.
Pair Corralation between Care Property and Aedifica
Assuming the 90 days trading horizon Care Property Invest is expected to under-perform the Aedifica. In addition to that, Care Property is 1.38 times more volatile than Aedifica. It trades about -0.12 of its total potential returns per unit of risk. Aedifica is currently generating about 0.02 per unit of volatility. If you would invest 5,795 in Aedifica on November 4, 2024 and sell it today you would earn a total of 30.00 from holding Aedifica or generate 0.52% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Care Property Invest vs. Aedifica
Performance |
| Timeline |
| Care Property Invest |
| Aedifica |
Care Property and Aedifica Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Care Property and Aedifica
The main advantage of trading using opposite Care Property and Aedifica positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Care Property position performs unexpectedly, Aedifica 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 Aedifica will offset losses from the drop in Aedifica's long position.| Care Property vs. Aedifica | Care Property vs. Cofinimmo SA | Care Property vs. Xior Student Housing | Care Property vs. VGP NV |
| Aedifica vs. Cofinimmo SA | Aedifica vs. Warehouses de Pauw | Aedifica vs. Care Property Invest | Aedifica vs. Xior Student Housing |
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 Efficient Frontier module to plot and analyze your portfolio and positions against risk-return landscape of the market..
Other Complementary Tools
| Bollinger Bands Use Bollinger Bands indicator to analyze target price for a given investing horizon | |
| Efficient Frontier Plot and analyze your portfolio and positions against risk-return landscape of the market. | |
| Portfolio Analyzer Portfolio analysis module that provides access to portfolio diagnostics and optimization engine | |
| Aroon Oscillator Analyze current equity momentum using Aroon Oscillator and other momentum ratios | |
| ETF Categories List of ETF categories grouped based on various criteria, such as the investment strategy or type of investments |