Correlation Between CREDIT IMMOBILIER and AFRIQUIA GAZ

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

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

Diversification Opportunities for CREDIT IMMOBILIER and AFRIQUIA GAZ

0.29

Correlation Coefficient

CREDIT IMMOBILIER  AFRIQUIA GAZ

Modest diversification

The 3 months correlation between CREDIT and AFRIQUIA is 0.29. Overlapping area represents the amount of risk that can be diversified away by holding CREDIT IMMOBILIER ET and AFRIQUIA GAZ in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on AFRIQUIA GAZ and CREDIT IMMOBILIER 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 CREDIT IMMOBILIER ET are associated (or correlated) with AFRIQUIA GAZ. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of AFRIQUIA GAZ has no effect on the direction of CREDIT IMMOBILIER i.e., CREDIT IMMOBILIER and AFRIQUIA GAZ go up and down completely randomly.

Pair Corralation between CREDIT IMMOBILIER and AFRIQUIA GAZ

Assuming the 90 days trading horizon CREDIT IMMOBILIER ET is expected to generate 1.07 times more return on investment than AFRIQUIA GAZ. However, CREDIT IMMOBILIER is 1.07 times more volatile than AFRIQUIA GAZ. It trades about 0.05 of its potential returns per unit of risk. AFRIQUIA GAZ is currently generating about 0.0 per unit of risk. If you would invest  29,990  in CREDIT IMMOBILIER ET on September 16, 2024 and sell it today you would earn a total of  10,500  from holding CREDIT IMMOBILIER ET or generate 35.01% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Together
Strength	Very Weak
Accuracy	74.54%
Values	Daily Returns

CREDIT IMMOBILIER ET  vs.  AFRIQUIA GAZ

CREDIT IMMOBILIER

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days CREDIT IMMOBILIER ET has generated negative risk-adjusted returns adding no value to investors with long positions. 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.

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 latest stock price confusion, may contribute to short-horizon losses for the traders.

Pair Trading with CREDIT IMMOBILIER and AFRIQUIA GAZ

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

The idea behind CREDIT IMMOBILIER ET and AFRIQUIA GAZ 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 Stock Tickers module to use high-impact, comprehensive, and customizable stock tickers that can be easily integrated to any websites.