Correlation Between Hammerson PLC and Alstria Office
Can any of the company-specific risk be diversified away by investing in both Hammerson PLC 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 Hammerson PLC and Alstria Office into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Hammerson PLC and alstria office REIT AG, you can compare the effects of market volatilities on Hammerson PLC 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 Hammerson PLC with a short position of Alstria Office. Check out your portfolio center. Please also check ongoing floating volatility patterns of Hammerson PLC and Alstria Office.
Diversification Opportunities for Hammerson PLC and Alstria Office
-0.76 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between Hammerson and Alstria is -0.76. Overlapping area represents the amount of risk that can be diversified away by holding Hammerson PLC 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 Hammerson PLC 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 Hammerson PLC 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 Hammerson PLC i.e., Hammerson PLC and Alstria Office go up and down completely randomly.
Pair Corralation between Hammerson PLC and Alstria Office
Assuming the 90 days trading horizon Hammerson PLC is expected to generate 8.15 times less return on investment than Alstria Office. But when comparing it to its historical volatility, Hammerson PLC is 1.23 times less risky than Alstria Office. It trades about 0.05 of its potential returns per unit of risk. alstria office REIT AG is currently generating about 0.35 of returns per unit of risk over similar time horizon. If you would invest 682.00 in alstria office REIT AG on September 20, 2024 and sell it today you would earn a total of 87.00 from holding alstria office REIT AG or generate 12.76% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Hammerson PLC vs. alstria office REIT AG
Performance |
| Timeline |
| Hammerson PLC |
| alstria office REIT |
Hammerson PLC and Alstria Office Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Hammerson PLC and Alstria Office
The main advantage of trading using opposite Hammerson PLC and Alstria Office positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Hammerson PLC 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.| Hammerson PLC vs. Derwent London PLC | Hammerson PLC vs. Workspace Group PLC | Hammerson PLC vs. Supermarket Income REIT | Hammerson PLC vs. DS Smith PLC |
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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 Technical Analysis module to check basic technical indicators and analysis based on most latest market data.
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