Correlation Between Van Lanschot and Basic Fit
Can any of the company-specific risk be diversified away by investing in both Van Lanschot and Basic Fit 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 Van Lanschot and Basic Fit into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Van Lanschot NV and Basic Fit NV, you can compare the effects of market volatilities on Van Lanschot and Basic Fit 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 Van Lanschot with a short position of Basic Fit. Check out your portfolio center. Please also check ongoing floating volatility patterns of Van Lanschot and Basic Fit.
Diversification Opportunities for Van Lanschot and Basic Fit
0.54 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Van and Basic is 0.54. Overlapping area represents the amount of risk that can be diversified away by holding Van Lanschot NV and Basic Fit NV in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Basic Fit NV and Van Lanschot 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 Van Lanschot NV are associated (or correlated) with Basic Fit. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Basic Fit NV has no effect on the direction of Van Lanschot i.e., Van Lanschot and Basic Fit go up and down completely randomly.
Pair Corralation between Van Lanschot and Basic Fit
Assuming the 90 days trading horizon Van Lanschot NV is expected to generate 0.59 times more return on investment than Basic Fit. However, Van Lanschot NV is 1.7 times less risky than Basic Fit. It trades about 0.14 of its potential returns per unit of risk. Basic Fit NV is currently generating about 0.07 per unit of risk. If you would invest 4,400 in Van Lanschot NV on November 9, 2024 and sell it today you would earn a total of 315.00 from holding Van Lanschot NV or generate 7.16% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Van Lanschot NV vs. Basic Fit NV
Performance |
| Timeline |
| Van Lanschot NV |
| Basic Fit NV |
Van Lanschot and Basic Fit Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Van Lanschot and Basic Fit
The main advantage of trading using opposite Van Lanschot and Basic Fit positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Van Lanschot position performs unexpectedly, Basic Fit 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 Basic Fit will offset losses from the drop in Basic Fit's long position.| Van Lanschot vs. ASR Nederland NV | Van Lanschot vs. NN Group NV | Van Lanschot vs. TKH Group NV | Van Lanschot vs. Koninklijke Heijmans NV |
| Basic Fit vs. Alfen Beheer BV | Basic Fit vs. Just Eat Takeaway | Basic Fit vs. Kinepolis Group NV | Basic Fit vs. Galapagos 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 Headlines Timeline module to stay connected to all market stories and filter out noise. Drill down to analyze hype elasticity.
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