Correlation Between Home Invest and Nextensa
Can any of the company-specific risk be diversified away by investing in both Home Invest and Nextensa 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 Home Invest and Nextensa into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Home Invest Belgium and Nextensa NV, you can compare the effects of market volatilities on Home Invest and Nextensa 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 Home Invest with a short position of Nextensa. Check out your portfolio center. Please also check ongoing floating volatility patterns of Home Invest and Nextensa.
Diversification Opportunities for Home Invest and Nextensa
0.39 | Correlation Coefficient |
Weak diversification
The 3 months correlation between Home and Nextensa is 0.39. Overlapping area represents the amount of risk that can be diversified away by holding Home Invest Belgium and Nextensa NV in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Nextensa NV and Home Invest 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 Home Invest Belgium are associated (or correlated) with Nextensa. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Nextensa NV has no effect on the direction of Home Invest i.e., Home Invest and Nextensa go up and down completely randomly.
Pair Corralation between Home Invest and Nextensa
Assuming the 90 days trading horizon Home Invest Belgium is expected to generate 0.91 times more return on investment than Nextensa. However, Home Invest Belgium is 1.1 times less risky than Nextensa. It trades about 0.24 of its potential returns per unit of risk. Nextensa NV is currently generating about -0.2 per unit of risk. If you would invest 1,710 in Home Invest Belgium on November 2, 2024 and sell it today you would earn a total of 132.00 from holding Home Invest Belgium or generate 7.72% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 95.45% |
| Values | Daily Returns |
Home Invest Belgium vs. Nextensa NV
Performance |
| Timeline |
| Home Invest Belgium |
| Nextensa NV |
Home Invest and Nextensa Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Home Invest and Nextensa
The main advantage of trading using opposite Home Invest and Nextensa positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Home Invest position performs unexpectedly, Nextensa 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 Nextensa will offset losses from the drop in Nextensa's long position.| Home Invest vs. Cofinimmo SA | Home Invest vs. Care Property Invest | Home Invest vs. Aedifica | Home Invest vs. Montea CVA |
| Nextensa vs. Retail Estates | Nextensa vs. EVS Broadcast Equipment | Nextensa vs. Onward Medical NV | Nextensa vs. Shurgard Self Storage |
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 Insider Screener module to find insiders across different sectors to evaluate their impact on performance.
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