Correlation Between Adler Group and Belpointe PREP

Can any of the company-specific risk be diversified away by investing in both Adler Group and Belpointe PREP 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 Adler Group and Belpointe PREP into the same portfolio, which is an essential part of the fundamental portfolio management process.

By analyzing existing cross correlation between Adler Group SA and Belpointe PREP LLC, you can compare the effects of market volatilities on Adler Group and Belpointe PREP 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 Adler Group with a short position of Belpointe PREP. Check out your portfolio center. Please also check ongoing floating volatility patterns of Adler Group and Belpointe PREP.

Diversification Opportunities for Adler Group and Belpointe PREP

-0.14

Correlation Coefficient

Adler Group  Belpointe PREP

Good diversification

The 3 months correlation between Adler and Belpointe is -0.14. Overlapping area represents the amount of risk that can be diversified away by holding Adler Group SA and Belpointe PREP LLC in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Belpointe PREP LLC and Adler Group 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 Adler Group SA are associated (or correlated) with Belpointe PREP. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Belpointe PREP LLC has no effect on the direction of Adler Group i.e., Adler Group and Belpointe PREP go up and down completely randomly.

Pair Corralation between Adler Group and Belpointe PREP

Assuming the 90 days horizon Adler Group SA is expected to generate 1.64 times more return on investment than Belpointe PREP. However, Adler Group is 1.64 times more volatile than Belpointe PREP LLC. It trades about 0.12 of its potential returns per unit of risk. Belpointe PREP LLC is currently generating about 0.06 per unit of risk. If you would invest  27.00  in Adler Group SA on December 10, 2024 and sell it today you would earn a total of  8.00  from holding Adler Group SA or generate 29.63% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Against
Strength	Insignificant
Accuracy	54.47%
Values	Daily Returns

Adler Group SA  vs.  Belpointe PREP LLC

Adler Group SA

Risk-Adjusted Performance

Very Weak

Over the last 90 days Adler Group SA has generated negative risk-adjusted returns adding no value to investors with long positions. Despite nearly stable basic indicators, Adler Group is not utilizing all of its potentials. The current stock price disturbance, may contribute to mid-run losses for the stockholders.

Belpointe PREP LLC

Risk-Adjusted Performance

Very Weak

Compared to the overall equity markets, risk-adjusted returns on investments in Belpointe PREP LLC are ranked lower than 1 (%) of all global equities and portfolios over the last 90 days. In spite of fairly strong basic indicators, Belpointe PREP is not utilizing all of its potentials. The current stock price disturbance, may contribute to short-term losses for the investors.

Pair Trading with Adler Group and Belpointe PREP

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

The idea behind Adler Group SA and Belpointe PREP LLC 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 Theme Ratings module to determine theme ratings based on digital equity recommendations. Macroaxis theme ratings are based on combination of fundamental analysis and risk-adjusted market performance.