Correlation Between Plaza Centers and Caffyns PLC
Can any of the company-specific risk be diversified away by investing in both Plaza Centers and Caffyns PLC 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 Plaza Centers and Caffyns PLC into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Plaza Centers NV and Caffyns PLC, you can compare the effects of market volatilities on Plaza Centers and Caffyns PLC 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 Plaza Centers with a short position of Caffyns PLC. Check out your portfolio center. Please also check ongoing floating volatility patterns of Plaza Centers and Caffyns PLC.
Diversification Opportunities for Plaza Centers and Caffyns PLC
0.35 | Correlation Coefficient |
Weak diversification
The 3 months correlation between Plaza and Caffyns is 0.35. Overlapping area represents the amount of risk that can be diversified away by holding Plaza Centers NV and Caffyns PLC in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Caffyns PLC and Plaza Centers 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 Plaza Centers NV are associated (or correlated) with Caffyns PLC. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Caffyns PLC has no effect on the direction of Plaza Centers i.e., Plaza Centers and Caffyns PLC go up and down completely randomly.
Pair Corralation between Plaza Centers and Caffyns PLC
Assuming the 90 days trading horizon Plaza Centers NV is expected to generate 1.36 times more return on investment than Caffyns PLC. However, Plaza Centers is 1.36 times more volatile than Caffyns PLC. It trades about 0.0 of its potential returns per unit of risk. Caffyns PLC is currently generating about -0.02 per unit of risk. If you would invest 3,000 in Plaza Centers NV on August 30, 2024 and sell it today you would lose (500.00) from holding Plaza Centers NV or give up 16.67% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Plaza Centers NV vs. Caffyns PLC
Performance |
| Timeline |
| Plaza Centers NV |
| Caffyns PLC |
Plaza Centers and Caffyns PLC Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Plaza Centers and Caffyns PLC
The main advantage of trading using opposite Plaza Centers and Caffyns PLC positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Plaza Centers position performs unexpectedly, Caffyns PLC 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 Caffyns PLC will offset losses from the drop in Caffyns PLC's long position.| Plaza Centers vs. JB Hunt Transport | Plaza Centers vs. Park Hotels Resorts | Plaza Centers vs. Dalata Hotel Group | Plaza Centers vs. PPHE Hotel Group |
| Caffyns PLC vs. Hansa Investment | Caffyns PLC vs. Diversified Energy | Caffyns PLC vs. Evolution Gaming Group | Caffyns PLC vs. Federal Realty Investment |
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 Price Exposure Probability module to analyze equity upside and downside potential for a given time horizon across multiple markets.
Other Complementary Tools
| Price Ceiling Movement Calculate and plot Price Ceiling Movement for different equity instruments | |
| Portfolio Center All portfolio management and optimization tools to improve performance of your portfolios | |
| Fundamental Analysis View fundamental data based on most recent published financial statements | |
| Funds Screener Find actively-traded funds from around the world traded on over 30 global exchanges | |
| Earnings Calls Check upcoming earnings announcements updated hourly across public exchanges |