Correlation Between Immobel and Bpost NV
Can any of the company-specific risk be diversified away by investing in both Immobel and Bpost NV 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 Immobel and Bpost NV into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Immobel and Bpost NV, you can compare the effects of market volatilities on Immobel and Bpost NV 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 Immobel with a short position of Bpost NV. Check out your portfolio center. Please also check ongoing floating volatility patterns of Immobel and Bpost NV.
Diversification Opportunities for Immobel and Bpost NV
Very poor diversification
The 3 months correlation between Immobel and Bpost is 0.83. Overlapping area represents the amount of risk that can be diversified away by holding Immobel and Bpost NV in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Bpost NV and Immobel 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 Immobel are associated (or correlated) with Bpost NV. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Bpost NV has no effect on the direction of Immobel i.e., Immobel and Bpost NV go up and down completely randomly.
Pair Corralation between Immobel and Bpost NV
Assuming the 90 days trading horizon Immobel is expected to generate 0.91 times more return on investment than Bpost NV. However, Immobel is 1.1 times less risky than Bpost NV. It trades about -0.3 of its potential returns per unit of risk. Bpost NV is currently generating about -0.55 per unit of risk. If you would invest 1,872 in Immobel on September 1, 2024 and sell it today you would lose (202.00) from holding Immobel or give up 10.79% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Immobel vs. Bpost NV
Performance |
| Timeline |
| Immobel |
| Bpost NV |
Immobel and Bpost NV Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Immobel and Bpost NV
The main advantage of trading using opposite Immobel and Bpost NV positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Immobel position performs unexpectedly, Bpost NV 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 Bpost NV will offset losses from the drop in Bpost NV's long position.The idea behind Immobel and Bpost NV pairs trading is to make the combined position market-neutral, meaning the overall market's direction will not affect its win or loss (or potential downside or upside). This can be achieved by designing a pairs trade with two highly correlated stocks or equities that operate in a similar space or sector, making it possible to obtain profits through simple and relatively low-risk investment.| Bpost NV vs. Proximus NV | Bpost NV vs. ageas SANV | Bpost NV vs. Etablissementen Franz Colruyt | Bpost NV vs. KBC Groep NV |
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 Bonds Directory module to find actively traded corporate debentures issued by US companies.
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