Correlation Between Colliers International and Cellnex Telecom

Can any of the company-specific risk be diversified away by investing in both Colliers International and Cellnex Telecom 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 Colliers International and Cellnex Telecom into the same portfolio, which is an essential part of the fundamental portfolio management process.

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

Diversification Opportunities for Colliers International and Cellnex Telecom

0.52

Correlation Coefficient

Colliers International  Cellnex Telecom

Very weak diversification

The 3 months correlation between Colliers and Cellnex is 0.52. Overlapping area represents the amount of risk that can be diversified away by holding Colliers International Group and Cellnex Telecom SA in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Cellnex Telecom SA and Colliers International 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 Colliers International Group are associated (or correlated) with Cellnex Telecom. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Cellnex Telecom SA has no effect on the direction of Colliers International i.e., Colliers International and Cellnex Telecom go up and down completely randomly.

Pair Corralation between Colliers International and Cellnex Telecom

Given the investment horizon of 90 days Colliers International Group is expected to under-perform the Cellnex Telecom. But the stock apears to be less risky and, when comparing its historical volatility, Colliers International Group is 1.58 times less risky than Cellnex Telecom. The stock trades about -0.48 of its potential returns per unit of risk. The Cellnex Telecom SA is currently generating about -0.22 of returns per unit of risk over similar time horizon. If you would invest  3,489  in Cellnex Telecom SA on September 24, 2024 and sell it today you would lose (335.00) from holding Cellnex Telecom SA or give up 9.6% of portfolio value over 90 days.

Time Period	3 Months [change]
Direction	Moves Together
Strength	Weak
Accuracy	95.24%
Values	Daily Returns

Colliers International Group  vs.  Cellnex Telecom SA

Colliers International

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Colliers International Group has generated negative risk-adjusted returns adding no value to investors with long positions. Despite latest inconsistent performance, the Stock's technical and fundamental indicators remain strong and the recent confusion on Wall Street may also be a sign of long-lasting gains for the firm traders.

Cellnex Telecom SA

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Cellnex Telecom SA has generated negative risk-adjusted returns adding no value to investors with long positions. Despite unsteady performance in the last few months, the Stock's basic indicators remain nearly stable which may send shares a bit higher in January 2025. The current disturbance may also be a sign of long-run up-swing for the company stockholders.

Pair Trading with Colliers International and Cellnex Telecom

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

The idea behind Colliers International Group and Cellnex Telecom SA 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 Portfolio Dashboard module to portfolio dashboard that provides centralized access to all your investments.