Correlation Between Neinor Homes and Elaia Investment
Can any of the company-specific risk be diversified away by investing in both Neinor Homes and Elaia Investment 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 Neinor Homes and Elaia Investment into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Neinor Homes SLU and Elaia Investment Spain, you can compare the effects of market volatilities on Neinor Homes and Elaia Investment 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 Neinor Homes with a short position of Elaia Investment. Check out your portfolio center. Please also check ongoing floating volatility patterns of Neinor Homes and Elaia Investment.
Diversification Opportunities for Neinor Homes and Elaia Investment
-0.13 | Correlation Coefficient |
Good diversification
The 3 months correlation between Neinor and Elaia is -0.13. Overlapping area represents the amount of risk that can be diversified away by holding Neinor Homes SLU and Elaia Investment Spain in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Elaia Investment Spain and Neinor Homes 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 Neinor Homes SLU are associated (or correlated) with Elaia Investment. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Elaia Investment Spain has no effect on the direction of Neinor Homes i.e., Neinor Homes and Elaia Investment go up and down completely randomly.
Pair Corralation between Neinor Homes and Elaia Investment
Assuming the 90 days trading horizon Neinor Homes SLU is expected to generate 0.29 times more return on investment than Elaia Investment. However, Neinor Homes SLU is 3.49 times less risky than Elaia Investment. It trades about 0.1 of its potential returns per unit of risk. Elaia Investment Spain is currently generating about -0.21 per unit of risk. If you would invest 1,474 in Neinor Homes SLU on August 24, 2024 and sell it today you would earn a total of 46.00 from holding Neinor Homes SLU or generate 3.12% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Neinor Homes SLU vs. Elaia Investment Spain
Performance |
| Timeline |
| Neinor Homes SLU |
| Elaia Investment Spain |
Neinor Homes and Elaia Investment Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Neinor Homes and Elaia Investment
The main advantage of trading using opposite Neinor Homes and Elaia Investment positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Neinor Homes position performs unexpectedly, Elaia Investment 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 Elaia Investment will offset losses from the drop in Elaia Investment's long position.| Neinor Homes vs. International Consolidated Airlines | Neinor Homes vs. Merlin Properties SOCIMI | Neinor Homes vs. Aena SA | Neinor Homes vs. Acerinox |
| Elaia Investment vs. Atrys Health SL | Elaia Investment vs. Cellnex Telecom SA | Elaia Investment vs. Neinor Homes SLU | Elaia Investment vs. Ebro Foods |
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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