Correlation Between CSIF III and Realstone Swiss

Can any of the company-specific risk be diversified away by investing in both CSIF III and Realstone Swiss 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 CSIF III and Realstone Swiss into the same portfolio, which is an essential part of the fundamental portfolio management process.

By analyzing existing cross correlation between CSIF III Equity and Realstone Swiss Property, you can compare the effects of market volatilities on CSIF III and Realstone Swiss 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 CSIF III with a short position of Realstone Swiss. Check out your portfolio center. Please also check ongoing floating volatility patterns of CSIF III and Realstone Swiss.

Diversification Opportunities for CSIF III and Realstone Swiss

0.66

Correlation Coefficient

CSIF III  Realstone Swiss

Poor diversification

The 3 months correlation between CSIF and Realstone is 0.66. Overlapping area represents the amount of risk that can be diversified away by holding CSIF III Equity and Realstone Swiss Property in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Realstone Swiss Property and CSIF III 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 CSIF III Equity are associated (or correlated) with Realstone Swiss. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Realstone Swiss Property has no effect on the direction of CSIF III i.e., CSIF III and Realstone Swiss go up and down completely randomly.

Pair Corralation between CSIF III and Realstone Swiss

Assuming the 90 days trading horizon CSIF III Equity is expected to under-perform the Realstone Swiss. But the fund apears to be less risky and, when comparing its historical volatility, CSIF III Equity is 1.09 times less risky than Realstone Swiss. The fund trades about -0.29 of its potential returns per unit of risk. The Realstone Swiss Property is currently generating about 0.32 of returns per unit of risk over similar time horizon. If you would invest  13,900  in Realstone Swiss Property on September 27, 2024 and sell it today you would earn a total of  800.00  from holding Realstone Swiss Property or generate 5.76% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Together
Strength	Significant
Accuracy	100.0%
Values	Daily Returns

CSIF III Equity  vs.  Realstone Swiss Property

CSIF III Equity

Risk-Adjusted Performance

4 of 100

Insignificant

Compared to the overall equity markets, risk-adjusted returns on investments in CSIF III Equity are ranked lower than 4 (%) of all funds and portfolios of funds over the last 90 days. In spite of fairly strong basic indicators, CSIF III is not utilizing all of its potentials. The recent stock price disturbance, may contribute to short-term losses for the investors.

Realstone Swiss Property

Risk-Adjusted Performance

16 of 100

Solid

Compared to the overall equity markets, risk-adjusted returns on investments in Realstone Swiss Property are ranked lower than 16 (%) of all funds and portfolios of funds over the last 90 days. In spite of fairly unsteady technical and fundamental indicators, Realstone Swiss may actually be approaching a critical reversion point that can send shares even higher in January 2025.

Pair Trading with CSIF III and Realstone Swiss

The main advantage of trading using opposite CSIF III and Realstone Swiss positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if CSIF III position performs unexpectedly, Realstone Swiss 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 Realstone Swiss will offset losses from the drop in Realstone Swiss' long position.

The idea behind CSIF III Equity and Realstone Swiss Property 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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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 Sync Your Broker module to sync your existing holdings, watchlists, positions or portfolios from thousands of online brokerage services, banks, investment account aggregators and robo-advisors..