Correlation Between Care Property and Campine
Can any of the company-specific risk be diversified away by investing in both Care Property and Campine 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 Campine 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 Campine, you can compare the effects of market volatilities on Care Property and Campine 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 Campine. Check out your portfolio center. Please also check ongoing floating volatility patterns of Care Property and Campine.
Diversification Opportunities for Care Property and Campine
-0.57 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between Care and Campine is -0.57. Overlapping area represents the amount of risk that can be diversified away by holding Care Property Invest and Campine in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Campine 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 Campine. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Campine has no effect on the direction of Care Property i.e., Care Property and Campine go up and down completely randomly.
Pair Corralation between Care Property and Campine
Assuming the 90 days trading horizon Care Property is expected to generate 15.54 times less return on investment than Campine. But when comparing it to its historical volatility, Care Property Invest is 1.27 times less risky than Campine. It trades about 0.01 of its potential returns per unit of risk. Campine is currently generating about 0.09 of returns per unit of risk over similar time horizon. If you would invest 4,065 in Campine on September 3, 2024 and sell it today you would earn a total of 4,885 from holding Campine or generate 120.17% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 98.22% |
| Values | Daily Returns |
Care Property Invest vs. Campine
Performance |
| Timeline |
| Care Property Invest |
| Campine |
Care Property and Campine Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Care Property and Campine
The main advantage of trading using opposite Care Property and Campine positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Care Property position performs unexpectedly, Campine 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 Campine will offset losses from the drop in Campine's long position.| Care Property vs. Aedifica | Care Property vs. Cofinimmo SA | Care Property vs. Xior Student Housing | Care Property vs. VGP NV |
| Campine vs. Miko NV | Campine vs. Tessenderlo | Campine vs. Van de Velde | Campine vs. EVS Broadcast Equipment |
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 My Watchlist Analysis module to analyze my current watchlist and to refresh optimization strategy. Macroaxis watchlist is based on self-learning algorithm to remember stocks you like.
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