Correlation Between Inhome Prime and Mercal Inmuebles
Can any of the company-specific risk be diversified away by investing in both Inhome Prime and Mercal Inmuebles 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 Inhome Prime and Mercal Inmuebles into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Inhome Prime Properties and Mercal Inmuebles Socimi, you can compare the effects of market volatilities on Inhome Prime and Mercal Inmuebles 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 Inhome Prime with a short position of Mercal Inmuebles. Check out your portfolio center. Please also check ongoing floating volatility patterns of Inhome Prime and Mercal Inmuebles.
Diversification Opportunities for Inhome Prime and Mercal Inmuebles
0.11 | Correlation Coefficient |
Average diversification
The 3 months correlation between Inhome and Mercal is 0.11. Overlapping area represents the amount of risk that can be diversified away by holding Inhome Prime Properties and Mercal Inmuebles Socimi in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Mercal Inmuebles Socimi and Inhome Prime 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 Inhome Prime Properties are associated (or correlated) with Mercal Inmuebles. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Mercal Inmuebles Socimi has no effect on the direction of Inhome Prime i.e., Inhome Prime and Mercal Inmuebles go up and down completely randomly.
Pair Corralation between Inhome Prime and Mercal Inmuebles
Assuming the 90 days trading horizon Inhome Prime is expected to generate 2.71 times less return on investment than Mercal Inmuebles. But when comparing it to its historical volatility, Inhome Prime Properties is 3.74 times less risky than Mercal Inmuebles. It trades about 0.05 of its potential returns per unit of risk. Mercal Inmuebles Socimi is currently generating about 0.04 of returns per unit of risk over similar time horizon. If you would invest 4,259 in Mercal Inmuebles Socimi on September 3, 2024 and sell it today you would earn a total of 721.00 from holding Mercal Inmuebles Socimi or generate 16.93% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 70.76% |
| Values | Daily Returns |
Inhome Prime Properties vs. Mercal Inmuebles Socimi
Performance |
| Timeline |
| Inhome Prime Properties |
| Mercal Inmuebles Socimi |
Inhome Prime and Mercal Inmuebles Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Inhome Prime and Mercal Inmuebles
The main advantage of trading using opposite Inhome Prime and Mercal Inmuebles positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Inhome Prime position performs unexpectedly, Mercal Inmuebles 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 Mercal Inmuebles will offset losses from the drop in Mercal Inmuebles' long position.| Inhome Prime vs. Airbus Group SE | Inhome Prime vs. Industria de Diseno | Inhome Prime vs. Vale SA | Inhome Prime vs. Iberdrola SA |
| Mercal Inmuebles vs. Parlem Telecom Companyia | Mercal Inmuebles vs. Tier1 Technology SA | Mercal Inmuebles vs. Caixabank SA | Mercal Inmuebles vs. Inhome Prime Properties |
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 Analysis module to research over 250,000 global equities including funds, stocks and ETFs to find investment opportunities.
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