Correlation Between Heidelberg Materials and Alstria Office
Can any of the company-specific risk be diversified away by investing in both Heidelberg Materials and Alstria Office 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 Heidelberg Materials and Alstria Office into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Heidelberg Materials AG and alstria office REIT AG, you can compare the effects of market volatilities on Heidelberg Materials and Alstria Office 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 Heidelberg Materials with a short position of Alstria Office. Check out your portfolio center. Please also check ongoing floating volatility patterns of Heidelberg Materials and Alstria Office.
Diversification Opportunities for Heidelberg Materials and Alstria Office
0.47 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Heidelberg and Alstria is 0.47. Overlapping area represents the amount of risk that can be diversified away by holding Heidelberg Materials AG and alstria office REIT AG in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on alstria office REIT and Heidelberg Materials 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 Heidelberg Materials AG are associated (or correlated) with Alstria Office. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of alstria office REIT has no effect on the direction of Heidelberg Materials i.e., Heidelberg Materials and Alstria Office go up and down completely randomly.
Pair Corralation between Heidelberg Materials and Alstria Office
Assuming the 90 days trading horizon Heidelberg Materials AG is expected to generate 0.21 times more return on investment than Alstria Office. However, Heidelberg Materials AG is 4.72 times less risky than Alstria Office. It trades about -0.01 of its potential returns per unit of risk. alstria office REIT AG is currently generating about -0.27 per unit of risk. If you would invest 12,355 in Heidelberg Materials AG on October 16, 2024 and sell it today you would lose (40.00) from holding Heidelberg Materials AG or give up 0.32% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Heidelberg Materials AG vs. alstria office REIT AG
Performance |
| Timeline |
| Heidelberg Materials |
| alstria office REIT |
Heidelberg Materials and Alstria Office Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Heidelberg Materials and Alstria Office
The main advantage of trading using opposite Heidelberg Materials and Alstria Office positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Heidelberg Materials position performs unexpectedly, Alstria Office 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 Alstria Office will offset losses from the drop in Alstria Office's long position.| Heidelberg Materials vs. Corporate Office Properties | Heidelberg Materials vs. INVITATION HOMES DL | Heidelberg Materials vs. Haier Smart Home | Heidelberg Materials vs. ADRIATIC METALS LS 013355 |
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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 USA ETFs module to find actively traded Exchange Traded Funds (ETF) in USA.
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