Correlation Between Retail Estates and ASSGENERALI ADR
Can any of the company-specific risk be diversified away by investing in both Retail Estates and ASSGENERALI ADR 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 Retail Estates and ASSGENERALI ADR into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Retail Estates NV and ASSGENERALI ADR 12EO, you can compare the effects of market volatilities on Retail Estates and ASSGENERALI ADR 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 Retail Estates with a short position of ASSGENERALI ADR. Check out your portfolio center. Please also check ongoing floating volatility patterns of Retail Estates and ASSGENERALI ADR.
Diversification Opportunities for Retail Estates and ASSGENERALI ADR
-0.37 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Retail and ASSGENERALI is -0.37. Overlapping area represents the amount of risk that can be diversified away by holding Retail Estates NV and ASSGENERALI ADR 12EO in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on ASSGENERALI ADR 12EO and Retail Estates 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 Retail Estates NV are associated (or correlated) with ASSGENERALI ADR. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of ASSGENERALI ADR 12EO has no effect on the direction of Retail Estates i.e., Retail Estates and ASSGENERALI ADR go up and down completely randomly.
Pair Corralation between Retail Estates and ASSGENERALI ADR
Assuming the 90 days horizon Retail Estates NV is expected to under-perform the ASSGENERALI ADR. But the stock apears to be less risky and, when comparing its historical volatility, Retail Estates NV is 1.37 times less risky than ASSGENERALI ADR. The stock trades about -0.34 of its potential returns per unit of risk. The ASSGENERALI ADR 12EO is currently generating about 0.12 of returns per unit of risk over similar time horizon. If you would invest 1,280 in ASSGENERALI ADR 12EO on August 29, 2024 and sell it today you would earn a total of 50.00 from holding ASSGENERALI ADR 12EO or generate 3.91% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 95.65% |
| Values | Daily Returns |
Retail Estates NV vs. ASSGENERALI ADR 12EO
Performance |
| Timeline |
| Retail Estates NV |
| ASSGENERALI ADR 12EO |
Retail Estates and ASSGENERALI ADR Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Retail Estates and ASSGENERALI ADR
The main advantage of trading using opposite Retail Estates and ASSGENERALI ADR positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Retail Estates position performs unexpectedly, ASSGENERALI ADR 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 ASSGENERALI ADR will offset losses from the drop in ASSGENERALI ADR's long position.| Retail Estates vs. DEVRY EDUCATION GRP | Retail Estates vs. MAGIC SOFTWARE ENTR | Retail Estates vs. EMBARK EDUCATION LTD | Retail Estates vs. GALENA MINING LTD |
| ASSGENERALI ADR vs. HomeToGo SE | ASSGENERALI ADR vs. Addus HomeCare | ASSGENERALI ADR vs. American Homes 4 | ASSGENERALI ADR vs. Retail Estates 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 Cryptocurrency Center module to build and monitor diversified portfolio of extremely risky digital assets and cryptocurrency.
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