Correlation Between GEELY AUTOMOBILE and Inmobiliaria Colonial
Can any of the company-specific risk be diversified away by investing in both GEELY AUTOMOBILE and Inmobiliaria Colonial 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 GEELY AUTOMOBILE and Inmobiliaria Colonial into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between GEELY AUTOMOBILE and Inmobiliaria Colonial SOCIMI, you can compare the effects of market volatilities on GEELY AUTOMOBILE and Inmobiliaria Colonial 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 GEELY AUTOMOBILE with a short position of Inmobiliaria Colonial. Check out your portfolio center. Please also check ongoing floating volatility patterns of GEELY AUTOMOBILE and Inmobiliaria Colonial.
Diversification Opportunities for GEELY AUTOMOBILE and Inmobiliaria Colonial
-0.71 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between GEELY and Inmobiliaria is -0.71. Overlapping area represents the amount of risk that can be diversified away by holding GEELY AUTOMOBILE and Inmobiliaria Colonial SOCIMI in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Inmobiliaria Colonial and GEELY AUTOMOBILE 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 GEELY AUTOMOBILE are associated (or correlated) with Inmobiliaria Colonial. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Inmobiliaria Colonial has no effect on the direction of GEELY AUTOMOBILE i.e., GEELY AUTOMOBILE and Inmobiliaria Colonial go up and down completely randomly.
Pair Corralation between GEELY AUTOMOBILE and Inmobiliaria Colonial
Assuming the 90 days trading horizon GEELY AUTOMOBILE is expected to generate 1.35 times more return on investment than Inmobiliaria Colonial. However, GEELY AUTOMOBILE is 1.35 times more volatile than Inmobiliaria Colonial SOCIMI. It trades about 0.06 of its potential returns per unit of risk. Inmobiliaria Colonial SOCIMI is currently generating about -0.11 per unit of risk. If you would invest 171.00 in GEELY AUTOMOBILE on September 5, 2024 and sell it today you would earn a total of 5.00 from holding GEELY AUTOMOBILE or generate 2.92% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
GEELY AUTOMOBILE vs. Inmobiliaria Colonial SOCIMI
Performance |
| Timeline |
| GEELY AUTOMOBILE |
| Inmobiliaria Colonial |
GEELY AUTOMOBILE and Inmobiliaria Colonial Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with GEELY AUTOMOBILE and Inmobiliaria Colonial
The main advantage of trading using opposite GEELY AUTOMOBILE and Inmobiliaria Colonial positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if GEELY AUTOMOBILE position performs unexpectedly, Inmobiliaria Colonial 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 Inmobiliaria Colonial will offset losses from the drop in Inmobiliaria Colonial's long position.| GEELY AUTOMOBILE vs. CarsalesCom | GEELY AUTOMOBILE vs. USU Software AG | GEELY AUTOMOBILE vs. INTER CARS SA | GEELY AUTOMOBILE vs. UPDATE SOFTWARE |
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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 ETFs module to find actively traded Exchange Traded Funds (ETF) from around the world.
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