Correlation Between Sofina Socit and Warehouses Estates
Can any of the company-specific risk be diversified away by investing in both Sofina Socit and Warehouses Estates 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 Warehouses Estates 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 Warehouses Estates Belgium, you can compare the effects of market volatilities on Sofina Socit and Warehouses Estates 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 Warehouses Estates. Check out your portfolio center. Please also check ongoing floating volatility patterns of Sofina Socit and Warehouses Estates.
Diversification Opportunities for Sofina Socit and Warehouses Estates
0.58 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Sofina and Warehouses is 0.58. Overlapping area represents the amount of risk that can be diversified away by holding Sofina Socit Anonyme and Warehouses Estates Belgium in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Warehouses Estates 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 Warehouses Estates. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Warehouses Estates has no effect on the direction of Sofina Socit i.e., Sofina Socit and Warehouses Estates go up and down completely randomly.
Pair Corralation between Sofina Socit and Warehouses Estates
Assuming the 90 days trading horizon Sofina Socit Anonyme is expected to under-perform the Warehouses Estates. In addition to that, Sofina Socit is 1.35 times more volatile than Warehouses Estates Belgium. It trades about -0.14 of its total potential returns per unit of risk. Warehouses Estates Belgium is currently generating about -0.18 per unit of volatility. If you would invest 3,870 in Warehouses Estates Belgium on August 31, 2024 and sell it today you would lose (150.00) from holding Warehouses Estates Belgium or give up 3.88% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 95.65% |
| Values | Daily Returns |
Sofina Socit Anonyme vs. Warehouses Estates Belgium
Performance |
| Timeline |
| Sofina Socit Anonyme |
| Warehouses Estates |
Sofina Socit and Warehouses Estates Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Sofina Socit and Warehouses Estates
The main advantage of trading using opposite Sofina Socit and Warehouses Estates positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Sofina Socit position performs unexpectedly, Warehouses Estates 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 Warehouses Estates will offset losses from the drop in Warehouses Estates' long position.| Sofina Socit vs. Ion Beam Applications | Sofina Socit vs. Keyware Technologies NV | Sofina Socit vs. Shurgard Self Storage | Sofina Socit vs. Home Invest Belgium |
| Warehouses Estates vs. Aedifica | Warehouses Estates vs. Cofinimmo SA | Warehouses Estates vs. VGP NV | Warehouses Estates vs. Sofina Socit Anonyme |
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 Analyzer module to analyze all characteristics, volatility and risk-adjusted return of Macroaxis ideas.
Other Complementary Tools
| ETF Categories List of ETF categories grouped based on various criteria, such as the investment strategy or type of investments | |
| Fundamental Analysis View fundamental data based on most recent published financial statements | |
| Idea Analyzer Analyze all characteristics, volatility and risk-adjusted return of Macroaxis ideas | |
| Equity Search Search for actively traded equities including funds and ETFs from over 30 global markets | |
| Portfolio Analyzer Portfolio analysis module that provides access to portfolio diagnostics and optimization engine |