Correlation Between GMP Property and EDreams Odigeo
Can any of the company-specific risk be diversified away by investing in both GMP Property and EDreams Odigeo 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 GMP Property and EDreams Odigeo into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between GMP Property SOCIMI and eDreams Odigeo SA, you can compare the effects of market volatilities on GMP Property and EDreams Odigeo 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 GMP Property with a short position of EDreams Odigeo. Check out your portfolio center. Please also check ongoing floating volatility patterns of GMP Property and EDreams Odigeo.
Diversification Opportunities for GMP Property and EDreams Odigeo
-0.7 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between GMP and EDreams is -0.7. Overlapping area represents the amount of risk that can be diversified away by holding GMP Property SOCIMI and eDreams Odigeo SA in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on eDreams Odigeo SA and GMP Property 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 GMP Property SOCIMI are associated (or correlated) with EDreams Odigeo. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of eDreams Odigeo SA has no effect on the direction of GMP Property i.e., GMP Property and EDreams Odigeo go up and down completely randomly.
Pair Corralation between GMP Property and EDreams Odigeo
Assuming the 90 days trading horizon GMP Property SOCIMI is expected to generate 1.34 times more return on investment than EDreams Odigeo. However, GMP Property is 1.34 times more volatile than eDreams Odigeo SA. It trades about 0.12 of its potential returns per unit of risk. eDreams Odigeo SA is currently generating about 0.0 per unit of risk. If you would invest 5,650 in GMP Property SOCIMI on August 28, 2024 and sell it today you would earn a total of 950.00 from holding GMP Property SOCIMI or generate 16.81% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 98.46% |
| Values | Daily Returns |
GMP Property SOCIMI vs. eDreams Odigeo SA
Performance |
| Timeline |
| GMP Property SOCIMI |
| eDreams Odigeo SA |
GMP Property and EDreams Odigeo Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with GMP Property and EDreams Odigeo
The main advantage of trading using opposite GMP Property and EDreams Odigeo positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if GMP Property position performs unexpectedly, EDreams Odigeo 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 EDreams Odigeo will offset losses from the drop in EDreams Odigeo's long position.| GMP Property vs. Bankinter | GMP Property vs. Caixabank SA | GMP Property vs. Atresmedia Corporacin de | GMP Property vs. Aedas Homes SL |
| EDreams Odigeo vs. Sacyr SA | EDreams Odigeo vs. Melia Hotels | EDreams Odigeo vs. ENCE Energa y | EDreams Odigeo vs. Solaria Energa y |
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 Money Managers module to screen money managers from public funds and ETFs managed around the world.
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