Correlation Between CS Real and SF Sustainable
Can any of the company-specific risk be diversified away by investing in both CS Real and SF Sustainable 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 CS Real and SF Sustainable into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between CS Real Estate and SF Sustainable Property, you can compare the effects of market volatilities on CS Real and SF Sustainable 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 CS Real with a short position of SF Sustainable. Check out your portfolio center. Please also check ongoing floating volatility patterns of CS Real and SF Sustainable.
Diversification Opportunities for CS Real and SF Sustainable
0.44 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between SIAT and SFPF is 0.44. Overlapping area represents the amount of risk that can be diversified away by holding CS Real Estate and SF Sustainable Property in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on SF Sustainable Property and CS Real 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 CS Real Estate are associated (or correlated) with SF Sustainable. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of SF Sustainable Property has no effect on the direction of CS Real i.e., CS Real and SF Sustainable go up and down completely randomly.
Pair Corralation between CS Real and SF Sustainable
Assuming the 90 days trading horizon CS Real Estate is expected to generate 1.09 times more return on investment than SF Sustainable. However, CS Real is 1.09 times more volatile than SF Sustainable Property. It trades about 0.11 of its potential returns per unit of risk. SF Sustainable Property is currently generating about 0.1 per unit of risk. If you would invest 21,900 in CS Real Estate on September 19, 2024 and sell it today you would earn a total of 2,800 from holding CS Real Estate or generate 12.79% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
CS Real Estate vs. SF Sustainable Property
Performance |
| Timeline |
| CS Real Estate |
| SF Sustainable Property |
CS Real and SF Sustainable Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with CS Real and SF Sustainable
The main advantage of trading using opposite CS Real and SF Sustainable positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if CS Real position performs unexpectedly, SF Sustainable 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 SF Sustainable will offset losses from the drop in SF Sustainable's long position.| CS Real vs. SPDR Dow Jones | CS Real vs. Baloise Holding AG | CS Real vs. SPDR FTSE UK | CS Real vs. Banque Cantonale du |
| SF Sustainable vs. SPDR Dow Jones | SF Sustainable vs. Baloise Holding AG | SF Sustainable vs. SPDR FTSE UK | SF Sustainable vs. Banque Cantonale du |
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 USA ETFs module to find actively traded Exchange Traded Funds (ETF) in USA.
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