Correlation Between Home Invest and Retail Estates
Can any of the company-specific risk be diversified away by investing in both Home Invest and Retail Estates 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 Retail Estates 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 Retail Estates , you can compare the effects of market volatilities on Home Invest and Retail Estates 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 Retail Estates. Check out your portfolio center. Please also check ongoing floating volatility patterns of Home Invest and Retail Estates.
Diversification Opportunities for Home Invest and Retail Estates
-0.27 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Home and Retail is -0.27. Overlapping area represents the amount of risk that can be diversified away by holding Home Invest Belgium and Retail Estates in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Retail Estates 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 Retail Estates. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Retail Estates has no effect on the direction of Home Invest i.e., Home Invest and Retail Estates go up and down completely randomly.
Pair Corralation between Home Invest and Retail Estates
Assuming the 90 days trading horizon Home Invest Belgium is expected to generate 1.56 times more return on investment than Retail Estates. However, Home Invest is 1.56 times more volatile than Retail Estates . It trades about 0.2 of its potential returns per unit of risk. Retail Estates is currently generating about -0.07 per unit of risk. If you would invest 1,626 in Home Invest Belgium on November 4, 2024 and sell it today you would earn a total of 214.00 from holding Home Invest Belgium or generate 13.16% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Home Invest Belgium vs. Retail Estates
Performance |
| Timeline |
| Home Invest Belgium |
| Retail Estates |
Home Invest and Retail Estates Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Home Invest and Retail Estates
The main advantage of trading using opposite Home Invest and Retail Estates positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Home Invest position performs unexpectedly, Retail Estates 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 Retail Estates will offset losses from the drop in Retail Estates' long position.| Home Invest vs. Cofinimmo SA | Home Invest vs. Care Property Invest | Home Invest vs. Aedifica | Home Invest vs. Montea CVA |
| Retail Estates vs. Cofinimmo SA | Retail Estates vs. Warehouses de Pauw | Retail Estates vs. Montea CVA | Retail Estates vs. Aedifica |
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 Bollinger Bands module to use Bollinger Bands indicator to analyze target price for a given investing horizon.
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