Correlation Between Arteche Lantegi and Fidere Patrimonio

Can any of the company-specific risk be diversified away by investing in both Arteche Lantegi and Fidere Patrimonio 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 Arteche Lantegi and Fidere Patrimonio into the same portfolio, which is an essential part of the fundamental portfolio management process.

By analyzing existing cross correlation between Arteche Lantegi Elkartea and Fidere Patrimonio SOCIMI, you can compare the effects of market volatilities on Arteche Lantegi and Fidere Patrimonio 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 Arteche Lantegi with a short position of Fidere Patrimonio. Check out your portfolio center. Please also check ongoing floating volatility patterns of Arteche Lantegi and Fidere Patrimonio.

Diversification Opportunities for Arteche Lantegi and Fidere Patrimonio

-0.11

Correlation Coefficient

Arteche Lantegi  Fidere Patrimonio

Good diversification

The 3 months correlation between Arteche and Fidere is -0.11. Overlapping area represents the amount of risk that can be diversified away by holding Arteche Lantegi Elkartea and Fidere Patrimonio SOCIMI in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Fidere Patrimonio SOCIMI and Arteche Lantegi 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 Arteche Lantegi Elkartea are associated (or correlated) with Fidere Patrimonio. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Fidere Patrimonio SOCIMI has no effect on the direction of Arteche Lantegi i.e., Arteche Lantegi and Fidere Patrimonio go up and down completely randomly.

Pair Corralation between Arteche Lantegi and Fidere Patrimonio

Assuming the 90 days trading horizon Arteche Lantegi Elkartea is expected to generate 4.26 times more return on investment than Fidere Patrimonio. However, Arteche Lantegi is 4.26 times more volatile than Fidere Patrimonio SOCIMI. It trades about 0.04 of its potential returns per unit of risk. Fidere Patrimonio SOCIMI is currently generating about -0.1 per unit of risk. If you would invest  745.00  in Arteche Lantegi Elkartea on December 30, 2024 and sell it today you would earn a total of  30.00  from holding Arteche Lantegi Elkartea or generate 4.03% return on investment over 90 days.

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

Arteche Lantegi Elkartea  vs.  Fidere Patrimonio SOCIMI

Arteche Lantegi Elkartea

Risk-Adjusted Performance

Weak

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

Fidere Patrimonio SOCIMI

Risk-Adjusted Performance

Very Weak

Over the last 90 days Fidere Patrimonio SOCIMI has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of rather sound fundamental indicators, Fidere Patrimonio is not utilizing all of its potentials. The latest stock price tumult, may contribute to shorter-term losses for the shareholders.

Pair Trading with Arteche Lantegi and Fidere Patrimonio

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

The idea behind Arteche Lantegi Elkartea and Fidere Patrimonio SOCIMI 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 USA ETFs module to find actively traded Exchange Traded Funds (ETF) in USA.