Correlation Between La Foncire and SF Sustainable
Can any of the company-specific risk be diversified away by investing in both La Foncire and SF Sustainable 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 La Foncire and SF Sustainable into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between La Foncire and SF Sustainable Property, you can compare the effects of market volatilities on La Foncire and SF Sustainable 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 La Foncire with a short position of SF Sustainable. Check out your portfolio center. Please also check ongoing floating volatility patterns of La Foncire and SF Sustainable.
Diversification Opportunities for La Foncire and SF Sustainable
0.19 | Correlation Coefficient |
Average diversification
The 3 months correlation between FOC and SFPF is 0.19. Overlapping area represents the amount of risk that can be diversified away by holding La Foncire and SF Sustainable Property in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on SF Sustainable Property and La Foncire 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 La Foncire are associated (or correlated) with SF Sustainable. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of SF Sustainable Property has no effect on the direction of La Foncire i.e., La Foncire and SF Sustainable go up and down completely randomly.
Pair Corralation between La Foncire and SF Sustainable
Assuming the 90 days trading horizon La Foncire is expected to generate 1.12 times more return on investment than SF Sustainable. However, La Foncire is 1.12 times more volatile than SF Sustainable Property. It trades about 0.25 of its potential returns per unit of risk. SF Sustainable Property is currently generating about 0.18 per unit of risk. If you would invest 14,550 in La Foncire on September 13, 2024 and sell it today you would earn a total of 750.00 from holding La Foncire or generate 5.15% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
La Foncire vs. SF Sustainable Property
Performance |
| Timeline |
| La Foncire |
| SF Sustainable Property |
La Foncire and SF Sustainable Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with La Foncire and SF Sustainable
The main advantage of trading using opposite La Foncire and SF Sustainable positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if La Foncire position performs unexpectedly, SF Sustainable 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 SF Sustainable will offset losses from the drop in SF Sustainable's long position.The idea behind La Foncire and SF Sustainable Property pairs trading is to make the combined position market-neutral, meaning the overall market's direction will not affect its win or loss (or potential downside or upside). This can be achieved by designing a pairs trade with two highly correlated stocks or equities that operate in a similar space or sector, making it possible to obtain profits through simple and relatively low-risk investment.| SF Sustainable vs. SPDR Dow Jones | SF Sustainable vs. Baloise Holding AG | SF Sustainable vs. SPDR FTSE UK | SF Sustainable vs. Banque Cantonale du |
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 Piotroski F Score module to get Piotroski F Score based on the binary analysis strategy of nine different fundamentals.
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