Correlation Between Groep Brussel and Ageas SANV
Can any of the company-specific risk be diversified away by investing in both Groep Brussel and Ageas SANV 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 Groep Brussel and Ageas SANV into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Groep Brussel Lambert and ageas SANV, you can compare the effects of market volatilities on Groep Brussel and Ageas SANV 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 Groep Brussel with a short position of Ageas SANV. Check out your portfolio center. Please also check ongoing floating volatility patterns of Groep Brussel and Ageas SANV.
Diversification Opportunities for Groep Brussel and Ageas SANV
0.66 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Groep and Ageas is 0.66. Overlapping area represents the amount of risk that can be diversified away by holding Groep Brussel Lambert and ageas SANV in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on ageas SANV and Groep Brussel 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 Groep Brussel Lambert are associated (or correlated) with Ageas SANV. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of ageas SANV has no effect on the direction of Groep Brussel i.e., Groep Brussel and Ageas SANV go up and down completely randomly.
Pair Corralation between Groep Brussel and Ageas SANV
Assuming the 90 days trading horizon Groep Brussel is expected to generate 40.66 times less return on investment than Ageas SANV. But when comparing it to its historical volatility, Groep Brussel Lambert is 1.21 times less risky than Ageas SANV. It trades about 0.0 of its potential returns per unit of risk. ageas SANV is currently generating about 0.14 of returns per unit of risk over similar time horizon. If you would invest 3,522 in ageas SANV on November 3, 2024 and sell it today you would earn a total of 1,460 from holding ageas SANV or generate 41.45% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Groep Brussel Lambert vs. ageas SANV
Performance |
| Timeline |
| Groep Brussel Lambert |
| ageas SANV |
Groep Brussel and Ageas SANV Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Groep Brussel and Ageas SANV
The main advantage of trading using opposite Groep Brussel and Ageas SANV positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Groep Brussel position performs unexpectedly, Ageas SANV 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 Ageas SANV will offset losses from the drop in Ageas SANV's long position.| Groep Brussel vs. Ackermans Van Haaren | Groep Brussel vs. Sofina Socit Anonyme | Groep Brussel vs. ageas SANV | Groep Brussel vs. Solvay SA |
| Ageas SANV vs. KBC Groep NV | Ageas SANV vs. Groep Brussel Lambert | Ageas SANV vs. Solvay SA | Ageas SANV vs. Ackermans Van Haaren |
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 FinTech Suite module to use AI to screen and filter profitable investment opportunities.
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