Correlation Between Impulse Fitness and Covivio Hotels
Can any of the company-specific risk be diversified away by investing in both Impulse Fitness and Covivio Hotels 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 Impulse Fitness and Covivio Hotels into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Impulse Fitness Solutions and Covivio Hotels, you can compare the effects of market volatilities on Impulse Fitness and Covivio Hotels 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 Impulse Fitness with a short position of Covivio Hotels. Check out your portfolio center. Please also check ongoing floating volatility patterns of Impulse Fitness and Covivio Hotels.
Diversification Opportunities for Impulse Fitness and Covivio Hotels
-0.18 | Correlation Coefficient |
Good diversification
The 3 months correlation between Impulse and Covivio is -0.18. Overlapping area represents the amount of risk that can be diversified away by holding Impulse Fitness Solutions and Covivio Hotels in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Covivio Hotels and Impulse Fitness 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 Impulse Fitness Solutions are associated (or correlated) with Covivio Hotels. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Covivio Hotels has no effect on the direction of Impulse Fitness i.e., Impulse Fitness and Covivio Hotels go up and down completely randomly.
Pair Corralation between Impulse Fitness and Covivio Hotels
Assuming the 90 days trading horizon Impulse Fitness Solutions is expected to under-perform the Covivio Hotels. In addition to that, Impulse Fitness is 2.88 times more volatile than Covivio Hotels. It trades about -0.21 of its total potential returns per unit of risk. Covivio Hotels is currently generating about 0.05 per unit of volatility. If you would invest 1,860 in Covivio Hotels on September 19, 2024 and sell it today you would earn a total of 15.00 from holding Covivio Hotels or generate 0.81% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Impulse Fitness Solutions vs. Covivio Hotels
Performance |
| Timeline |
| Impulse Fitness Solutions |
| Covivio Hotels |
Impulse Fitness and Covivio Hotels Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Impulse Fitness and Covivio Hotels
The main advantage of trading using opposite Impulse Fitness and Covivio Hotels positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Impulse Fitness position performs unexpectedly, Covivio Hotels 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 Covivio Hotels will offset losses from the drop in Covivio Hotels' long position.| Impulse Fitness vs. SA Catana Group | Impulse Fitness vs. Fountaine Pajo | Impulse Fitness vs. Piscines Desjoyaux SA |
| Covivio Hotels vs. Covivio SA | Covivio Hotels vs. Altarea SCA | Covivio Hotels vs. Icade SA | Covivio Hotels vs. Gecina SA |
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 Portfolio Suggestion module to get suggestions outside of your existing asset allocation including your own model portfolios.
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