Correlation Between Castellana Properties and Aena SA
Can any of the company-specific risk be diversified away by investing in both Castellana Properties and Aena 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 Castellana Properties and Aena SA into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Castellana Properties Socimi and Aena SA, you can compare the effects of market volatilities on Castellana Properties and Aena 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 Castellana Properties with a short position of Aena SA. Check out your portfolio center. Please also check ongoing floating volatility patterns of Castellana Properties and Aena SA.
Diversification Opportunities for Castellana Properties and Aena SA
-0.1 | Correlation Coefficient |
Good diversification
The 3 months correlation between Castellana and Aena is -0.1. Overlapping area represents the amount of risk that can be diversified away by holding Castellana Properties Socimi and Aena SA in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Aena SA and Castellana Properties 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 Castellana Properties Socimi are associated (or correlated) with Aena SA. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Aena SA has no effect on the direction of Castellana Properties i.e., Castellana Properties and Aena SA go up and down completely randomly.
Pair Corralation between Castellana Properties and Aena SA
If you would invest 20,240 in Aena SA on November 27, 2024 and sell it today you would earn a total of 1,060 from holding Aena SA or generate 5.24% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Castellana Properties Socimi vs. Aena SA
Performance |
| Timeline |
| Castellana Properties |
| Aena SA |
Castellana Properties and Aena SA Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Castellana Properties and Aena SA
The main advantage of trading using opposite Castellana Properties and Aena SA positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Castellana Properties position performs unexpectedly, Aena 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 Aena SA will offset losses from the drop in Aena SA's long position.The idea behind Castellana Properties Socimi and Aena SA pairs trading is to make the combined position market-neutral, meaning the overall market's direction will not affect its win or loss (or potential downside or upside). This can be achieved by designing a pairs trade with two highly correlated stocks or equities that operate in a similar space or sector, making it possible to obtain profits through simple and relatively low-risk investment.
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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 Bonds Directory module to find actively traded corporate debentures issued by US companies.
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