Correlation Between Eurocastle Investment and Allfunds
Can any of the company-specific risk be diversified away by investing in both Eurocastle Investment and Allfunds 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 Eurocastle Investment and Allfunds into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Eurocastle Investment and Allfunds Group, you can compare the effects of market volatilities on Eurocastle Investment and Allfunds 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 Eurocastle Investment with a short position of Allfunds. Check out your portfolio center. Please also check ongoing floating volatility patterns of Eurocastle Investment and Allfunds.
Diversification Opportunities for Eurocastle Investment and Allfunds
-0.3 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Eurocastle and Allfunds is -0.3. Overlapping area represents the amount of risk that can be diversified away by holding Eurocastle Investment and Allfunds Group in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Allfunds Group and Eurocastle Investment 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 Eurocastle Investment are associated (or correlated) with Allfunds. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Allfunds Group has no effect on the direction of Eurocastle Investment i.e., Eurocastle Investment and Allfunds go up and down completely randomly.
Pair Corralation between Eurocastle Investment and Allfunds
Assuming the 90 days trading horizon Eurocastle Investment is expected to under-perform the Allfunds. In addition to that, Eurocastle Investment is 1.97 times more volatile than Allfunds Group. It trades about -0.14 of its total potential returns per unit of risk. Allfunds Group is currently generating about 0.02 per unit of volatility. If you would invest 551.00 in Allfunds Group on September 1, 2024 and sell it today you would earn a total of 8.00 from holding Allfunds Group or generate 1.45% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 35.38% |
| Values | Daily Returns |
Eurocastle Investment vs. Allfunds Group
Performance |
| Timeline |
| Eurocastle Investment |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Very Weak
| Allfunds Group |
Eurocastle Investment and Allfunds Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Eurocastle Investment and Allfunds
The main advantage of trading using opposite Eurocastle Investment and Allfunds positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Eurocastle Investment position performs unexpectedly, Allfunds 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 Allfunds will offset losses from the drop in Allfunds' long position.| Eurocastle Investment vs. Tetragon Financial Group | Eurocastle Investment vs. Ctac NV | Eurocastle Investment vs. iShares SP 500 | Eurocastle Investment vs. Hydratec Industries NV |
| Allfunds vs. Pershing Square Holdings | Allfunds vs. Universal Music Group | Allfunds vs. Hydratec Industries NV | Allfunds vs. BlackRock ESG Multi Asset |
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 Comparator module to compare the composition, asset allocations and performance of any two portfolios in your account.
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