Correlation Between Sofina Socit and Banimmo SA
Can any of the company-specific risk be diversified away by investing in both Sofina Socit and Banimmo SA 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 Sofina Socit and Banimmo SA into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Sofina Socit Anonyme and Banimmo SA, you can compare the effects of market volatilities on Sofina Socit and Banimmo SA 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 Sofina Socit with a short position of Banimmo SA. Check out your portfolio center. Please also check ongoing floating volatility patterns of Sofina Socit and Banimmo SA.
Diversification Opportunities for Sofina Socit and Banimmo SA
0.93 | Correlation Coefficient |
Almost no diversification
The 3 months correlation between Sofina and Banimmo is 0.93. Overlapping area represents the amount of risk that can be diversified away by holding Sofina Socit Anonyme and Banimmo SA in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Banimmo SA and Sofina Socit 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 Sofina Socit Anonyme are associated (or correlated) with Banimmo SA. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Banimmo SA has no effect on the direction of Sofina Socit i.e., Sofina Socit and Banimmo SA go up and down completely randomly.
Pair Corralation between Sofina Socit and Banimmo SA
Assuming the 90 days trading horizon Sofina Socit Anonyme is expected to under-perform the Banimmo SA. In addition to that, Sofina Socit is 1.53 times more volatile than Banimmo SA. It trades about -0.09 of its total potential returns per unit of risk. Banimmo SA is currently generating about -0.04 per unit of volatility. If you would invest 290.00 in Banimmo SA on September 14, 2024 and sell it today you would lose (2.00) from holding Banimmo SA or give up 0.69% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Sofina Socit Anonyme vs. Banimmo SA
Performance |
| Timeline |
| Sofina Socit Anonyme |
| Banimmo SA |
Sofina Socit and Banimmo SA Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Sofina Socit and Banimmo SA
The main advantage of trading using opposite Sofina Socit and Banimmo SA positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Sofina Socit position performs unexpectedly, Banimmo SA 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 Banimmo SA will offset losses from the drop in Banimmo SA's long position.| Sofina Socit vs. Vastned Retail Belgium | Sofina Socit vs. Keyware Technologies NV | Sofina Socit vs. Immolease Trust NV | Sofina Socit vs. Onward Medical NV |
| Banimmo SA vs. Atenor SA | Banimmo SA vs. Immobel | Banimmo SA vs. EVS Broadcast Equipment | Banimmo SA vs. Home Invest Belgium |
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 Idea Breakdown module to analyze constituents of all Macroaxis ideas. Macroaxis investment ideas are predefined, sector-focused investing themes.
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