Correlation Between Retail Estates and Thyssenkrupp
Can any of the company-specific risk be diversified away by investing in both Retail Estates and Thyssenkrupp 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 Thyssenkrupp 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 thyssenkrupp AG, you can compare the effects of market volatilities on Retail Estates and Thyssenkrupp 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 Thyssenkrupp. Check out your portfolio center. Please also check ongoing floating volatility patterns of Retail Estates and Thyssenkrupp.
Diversification Opportunities for Retail Estates and Thyssenkrupp
-0.78 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between Retail and Thyssenkrupp is -0.78. Overlapping area represents the amount of risk that can be diversified away by holding Retail Estates NV and thyssenkrupp AG in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on thyssenkrupp AG 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 Thyssenkrupp. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of thyssenkrupp AG has no effect on the direction of Retail Estates i.e., Retail Estates and Thyssenkrupp go up and down completely randomly.
Pair Corralation between Retail Estates and Thyssenkrupp
Assuming the 90 days horizon Retail Estates NV is expected to generate 0.4 times more return on investment than Thyssenkrupp. However, Retail Estates NV is 2.49 times less risky than Thyssenkrupp. It trades about 0.03 of its potential returns per unit of risk. thyssenkrupp AG is currently generating about 0.0 per unit of risk. If you would invest 4,928 in Retail Estates NV on September 21, 2024 and sell it today you would earn a total of 822.00 from holding Retail Estates NV or generate 16.68% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Retail Estates NV vs. thyssenkrupp AG
Performance |
| Timeline |
| Retail Estates NV |
| thyssenkrupp AG |
Retail Estates and Thyssenkrupp Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Retail Estates and Thyssenkrupp
The main advantage of trading using opposite Retail Estates and Thyssenkrupp positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Retail Estates position performs unexpectedly, Thyssenkrupp 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 Thyssenkrupp will offset losses from the drop in Thyssenkrupp's long position.| Retail Estates vs. Vicinity Centres | Retail Estates vs. Superior Plus Corp | Retail Estates vs. NMI Holdings | Retail Estates vs. SIVERS SEMICONDUCTORS AB |
| Thyssenkrupp vs. GRIFFIN MINING LTD | Thyssenkrupp vs. Burlington Stores | Thyssenkrupp vs. Fast Retailing Co | Thyssenkrupp 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 Bollinger Bands module to use Bollinger Bands indicator to analyze target price for a given investing horizon.
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