Correlation Between CITY OFFICE and Sixt SE
Can any of the company-specific risk be diversified away by investing in both CITY OFFICE and Sixt SE 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 CITY OFFICE and Sixt SE into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between CITY OFFICE REIT and Sixt SE, you can compare the effects of market volatilities on CITY OFFICE and Sixt SE 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 CITY OFFICE with a short position of Sixt SE. Check out your portfolio center. Please also check ongoing floating volatility patterns of CITY OFFICE and Sixt SE.
Diversification Opportunities for CITY OFFICE and Sixt SE
-0.38 | Correlation Coefficient |
Very good diversification
The 3 months correlation between CITY and Sixt is -0.38. Overlapping area represents the amount of risk that can be diversified away by holding CITY OFFICE REIT and Sixt SE in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Sixt SE and CITY OFFICE 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 CITY OFFICE REIT are associated (or correlated) with Sixt SE. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Sixt SE has no effect on the direction of CITY OFFICE i.e., CITY OFFICE and Sixt SE go up and down completely randomly.
Pair Corralation between CITY OFFICE and Sixt SE
Assuming the 90 days horizon CITY OFFICE REIT is expected to under-perform the Sixt SE. In addition to that, CITY OFFICE is 1.35 times more volatile than Sixt SE. It trades about -0.02 of its total potential returns per unit of risk. Sixt SE is currently generating about 0.21 per unit of volatility. If you would invest 6,880 in Sixt SE on December 2, 2024 and sell it today you would earn a total of 1,670 from holding Sixt SE or generate 24.27% return on investment over 90 days.
Time Period | 3 Months [change] |
Direction | Moves Against |
Strength | Insignificant |
Accuracy | 100.0% |
Values | Daily Returns |
CITY OFFICE REIT vs. Sixt SE
Performance |
Timeline |
CITY OFFICE REIT |
Sixt SE |
CITY OFFICE and Sixt SE Volatility Contrast
Predicted Return Density |
Returns |
Pair Trading with CITY OFFICE and Sixt SE
The main advantage of trading using opposite CITY OFFICE and Sixt SE positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if CITY OFFICE position performs unexpectedly, Sixt SE 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 Sixt SE will offset losses from the drop in Sixt SE's long position.CITY OFFICE vs. SPARTAN STORES | CITY OFFICE vs. Easy Software AG | CITY OFFICE vs. JIAHUA STORES | CITY OFFICE vs. National Retail Properties |
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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 Equity Search module to search for actively traded equities including funds and ETFs from over 30 global markets.
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