Correlation Between Vastned Retail and Strategic Investments
Can any of the company-specific risk be diversified away by investing in both Vastned Retail and Strategic Investments 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 Vastned Retail and Strategic Investments into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Vastned Retail NV and Strategic Investments AS, you can compare the effects of market volatilities on Vastned Retail and Strategic Investments 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 Vastned Retail with a short position of Strategic Investments. Check out your portfolio center. Please also check ongoing floating volatility patterns of Vastned Retail and Strategic Investments.
Diversification Opportunities for Vastned Retail and Strategic Investments
0.02 | Correlation Coefficient |
Significant diversification
The 3 months correlation between Vastned and Strategic is 0.02. Overlapping area represents the amount of risk that can be diversified away by holding Vastned Retail NV and Strategic Investments AS in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Strategic Investments and Vastned Retail 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 Vastned Retail NV are associated (or correlated) with Strategic Investments. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Strategic Investments has no effect on the direction of Vastned Retail i.e., Vastned Retail and Strategic Investments go up and down completely randomly.
Pair Corralation between Vastned Retail and Strategic Investments
Assuming the 90 days horizon Vastned Retail NV is expected to under-perform the Strategic Investments. But the stock apears to be less risky and, when comparing its historical volatility, Vastned Retail NV is 7.28 times less risky than Strategic Investments. The stock trades about -0.12 of its potential returns per unit of risk. The Strategic Investments AS is currently generating about 0.08 of returns per unit of risk over similar time horizon. If you would invest 13.00 in Strategic Investments AS on August 28, 2024 and sell it today you would earn a total of 1.00 from holding Strategic Investments AS or generate 7.69% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Vastned Retail NV vs. Strategic Investments AS
Performance |
| Timeline |
| Vastned Retail NV |
| Strategic Investments |
Vastned Retail and Strategic Investments Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Vastned Retail and Strategic Investments
The main advantage of trading using opposite Vastned Retail and Strategic Investments positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Vastned Retail position performs unexpectedly, Strategic Investments 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 Strategic Investments will offset losses from the drop in Strategic Investments' long position.| Vastned Retail vs. Vicinity Centres | Vastned Retail vs. Superior Plus Corp | Vastned Retail vs. NMI Holdings | Vastned Retail vs. Origin Agritech |
| Strategic Investments vs. Superior Plus Corp | Strategic Investments vs. NMI Holdings | Strategic Investments vs. Origin Agritech | Strategic Investments vs. SIVERS SEMICONDUCTORS AB |
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 Equity Search module to search for actively traded equities including funds and ETFs from over 30 global markets.
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