Correlation Between Montea CVA and Cofinimmo
Can any of the company-specific risk be diversified away by investing in both Montea CVA and Cofinimmo 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 Montea CVA and Cofinimmo into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Montea CVA and Cofinimmo SA, you can compare the effects of market volatilities on Montea CVA and Cofinimmo 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 Montea CVA with a short position of Cofinimmo. Check out your portfolio center. Please also check ongoing floating volatility patterns of Montea CVA and Cofinimmo.
Diversification Opportunities for Montea CVA and Cofinimmo
0.85 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between Montea and Cofinimmo is 0.85. Overlapping area represents the amount of risk that can be diversified away by holding Montea CVA and Cofinimmo SA in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Cofinimmo SA and Montea CVA 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 Montea CVA are associated (or correlated) with Cofinimmo. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Cofinimmo SA has no effect on the direction of Montea CVA i.e., Montea CVA and Cofinimmo go up and down completely randomly.
Pair Corralation between Montea CVA and Cofinimmo
Assuming the 90 days trading horizon Montea CVA is expected to generate 0.98 times more return on investment than Cofinimmo. However, Montea CVA is 1.02 times less risky than Cofinimmo. It trades about 0.02 of its potential returns per unit of risk. Cofinimmo SA is currently generating about -0.02 per unit of risk. If you would invest 6,077 in Montea CVA on August 28, 2024 and sell it today you would earn a total of 563.00 from holding Montea CVA or generate 9.26% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Montea CVA vs. Cofinimmo SA
Performance |
| Timeline |
| Montea CVA |
| Cofinimmo SA |
Montea CVA and Cofinimmo Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Montea CVA and Cofinimmo
The main advantage of trading using opposite Montea CVA and Cofinimmo positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Montea CVA position performs unexpectedly, Cofinimmo 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 Cofinimmo will offset losses from the drop in Cofinimmo's long position.| Montea CVA vs. Keyware Technologies NV | Montea CVA vs. Home Invest Belgium | Montea CVA vs. Ion Beam Applications | Montea CVA vs. Retail Estates |
| Cofinimmo vs. Home Invest Belgium | Cofinimmo vs. Wereldhav B Sicafi | Cofinimmo vs. Retail Estates | Cofinimmo vs. Exmar 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 Portfolio Suggestion module to get suggestions outside of your existing asset allocation including your own model portfolios.
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