Correlation Between WAWEL SA and Immobile
Can any of the company-specific risk be diversified away by investing in both WAWEL SA and Immobile 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 WAWEL SA and Immobile into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between WAWEL SA and Immobile, you can compare the effects of market volatilities on WAWEL SA and Immobile 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 WAWEL SA with a short position of Immobile. Check out your portfolio center. Please also check ongoing floating volatility patterns of WAWEL SA and Immobile.
Diversification Opportunities for WAWEL SA and Immobile
Average diversification
The 3 months correlation between WAWEL and Immobile is 0.12. Overlapping area represents the amount of risk that can be diversified away by holding WAWEL SA and Immobile in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Immobile and WAWEL SA 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 WAWEL SA are associated (or correlated) with Immobile. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Immobile has no effect on the direction of WAWEL SA i.e., WAWEL SA and Immobile go up and down completely randomly.
Pair Corralation between WAWEL SA and Immobile
Assuming the 90 days trading horizon WAWEL SA is expected to generate 1.4 times less return on investment than Immobile. In addition to that, WAWEL SA is 1.07 times more volatile than Immobile. It trades about 0.13 of its total potential returns per unit of risk. Immobile is currently generating about 0.19 per unit of volatility. If you would invest 181.00 in Immobile on September 13, 2024 and sell it today you would earn a total of 19.00 from holding Immobile or generate 10.5% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 95.65% |
| Values | Daily Returns |
WAWEL SA vs. Immobile
Performance |
| Timeline |
| WAWEL SA |
| Immobile |
WAWEL SA and Immobile Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with WAWEL SA and Immobile
The main advantage of trading using opposite WAWEL SA and Immobile positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if WAWEL SA position performs unexpectedly, Immobile 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 Immobile will offset losses from the drop in Immobile's long position.| WAWEL SA vs. Banco Santander SA | WAWEL SA vs. UniCredit SpA | WAWEL SA vs. CEZ as | WAWEL SA vs. Polski Koncern Naftowy |
| Immobile vs. MCI Management SA | Immobile vs. Asseco Business Solutions | Immobile vs. Detalion Games SA | Immobile vs. Asseco South Eastern |
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 Portfolio Manager module to state of the art Portfolio Manager to monitor and improve performance of your invested capital.
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