Correlation Between Exmar NV and Cofinimmo
Can any of the company-specific risk be diversified away by investing in both Exmar NV and Cofinimmo 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 Exmar NV and Cofinimmo into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Exmar NV and Cofinimmo SA, you can compare the effects of market volatilities on Exmar NV and Cofinimmo 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 Exmar NV with a short position of Cofinimmo. Check out your portfolio center. Please also check ongoing floating volatility patterns of Exmar NV and Cofinimmo.
Diversification Opportunities for Exmar NV and Cofinimmo
Poor diversification
The 3 months correlation between Exmar and Cofinimmo is 0.74. Overlapping area represents the amount of risk that can be diversified away by holding Exmar NV and Cofinimmo SA in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Cofinimmo SA and Exmar NV 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 Exmar NV are associated (or correlated) with Cofinimmo. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Cofinimmo SA has no effect on the direction of Exmar NV i.e., Exmar NV and Cofinimmo go up and down completely randomly.
Pair Corralation between Exmar NV and Cofinimmo
Assuming the 90 days trading horizon Exmar NV is expected to generate 1.54 times more return on investment than Cofinimmo. However, Exmar NV is 1.54 times more volatile than Cofinimmo SA. It trades about 0.06 of its potential returns per unit of risk. Cofinimmo SA is currently generating about -0.04 per unit of risk. If you would invest 515.00 in Exmar NV on August 29, 2024 and sell it today you would earn a total of 288.00 from holding Exmar NV or generate 55.92% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Exmar NV vs. Cofinimmo SA
Performance |
| Timeline |
| Exmar NV |
| Cofinimmo SA |
Exmar NV and Cofinimmo Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Exmar NV and Cofinimmo
The main advantage of trading using opposite Exmar NV and Cofinimmo positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Exmar NV position performs unexpectedly, Cofinimmo 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 Cofinimmo will offset losses from the drop in Cofinimmo's long position.| Exmar NV vs. EVS Broadcast Equipment | Exmar NV vs. NV Bekaert SA | Exmar NV vs. Tessenderlo | Exmar NV vs. Melexis NV |
| Cofinimmo vs. Home Invest Belgium | Cofinimmo vs. Retail Estates | Cofinimmo vs. Exmar NV | Cofinimmo vs. Unifiedpost Group SA |
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 Manager module to state of the art Portfolio Manager to monitor and improve performance of your invested capital.
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