Correlation Between AFRIQUIA GAZ and CREDIT IMMOBILIER

Can any of the company-specific risk be diversified away by investing in both AFRIQUIA GAZ and CREDIT IMMOBILIER 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 AFRIQUIA GAZ and CREDIT IMMOBILIER into the same portfolio, which is an essential part of the fundamental portfolio management process.

By analyzing existing cross correlation between AFRIQUIA GAZ and CREDIT IMMOBILIER ET, you can compare the effects of market volatilities on AFRIQUIA GAZ and CREDIT IMMOBILIER 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 AFRIQUIA GAZ with a short position of CREDIT IMMOBILIER. Check out your portfolio center. Please also check ongoing floating volatility patterns of AFRIQUIA GAZ and CREDIT IMMOBILIER.

Diversification Opportunities for AFRIQUIA GAZ and CREDIT IMMOBILIER

0.56

Correlation Coefficient

AFRIQUIA GAZ  CREDIT IMMOBILIER

Very weak diversification

The 3 months correlation between AFRIQUIA and CREDIT is 0.56. Overlapping area represents the amount of risk that can be diversified away by holding AFRIQUIA GAZ and CREDIT IMMOBILIER ET in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on CREDIT IMMOBILIER and AFRIQUIA GAZ 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 AFRIQUIA GAZ are associated (or correlated) with CREDIT IMMOBILIER. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of CREDIT IMMOBILIER has no effect on the direction of AFRIQUIA GAZ i.e., AFRIQUIA GAZ and CREDIT IMMOBILIER go up and down completely randomly.

Pair Corralation between AFRIQUIA GAZ and CREDIT IMMOBILIER

Assuming the 90 days trading horizon AFRIQUIA GAZ is expected to generate 0.47 times more return on investment than CREDIT IMMOBILIER. However, AFRIQUIA GAZ is 2.13 times less risky than CREDIT IMMOBILIER. It trades about 0.06 of its potential returns per unit of risk. CREDIT IMMOBILIER ET is currently generating about -0.07 per unit of risk. If you would invest  380,000  in AFRIQUIA GAZ on October 9, 2024 and sell it today you would earn a total of  3,000  from holding AFRIQUIA GAZ or generate 0.79% return on investment over 90 days.

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

AFRIQUIA GAZ  vs.  CREDIT IMMOBILIER ET

AFRIQUIA GAZ

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days AFRIQUIA GAZ has generated negative risk-adjusted returns adding no value to investors with long positions. Despite fairly strong basic indicators, AFRIQUIA GAZ is not utilizing all of its potentials. The recent stock price confusion, may contribute to short-horizon losses for the traders.

CREDIT IMMOBILIER

Risk-Adjusted Performance

2 of 100

Very Weak

Compared to the overall equity markets, risk-adjusted returns on investments in CREDIT IMMOBILIER ET are ranked lower than 2 (%) of all global equities and portfolios over the last 90 days. In spite of rather sound technical indicators, CREDIT IMMOBILIER is not utilizing all of its potentials. The current stock price tumult, may contribute to shorter-term losses for the shareholders.

Pair Trading with AFRIQUIA GAZ and CREDIT IMMOBILIER

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

The idea behind AFRIQUIA GAZ and CREDIT IMMOBILIER ET 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 Instant Ratings module to determine any equity ratings based on digital recommendations. Macroaxis instant equity ratings are based on combination of fundamental analysis and risk-adjusted market performance.