Correlation Between CREDIT IMMOBILIER and MAGHREBAIL

Can any of the company-specific risk be diversified away by investing in both CREDIT IMMOBILIER and MAGHREBAIL 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 MAGHREBAIL 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 MAGHREBAIL, you can compare the effects of market volatilities on CREDIT IMMOBILIER and MAGHREBAIL 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 MAGHREBAIL. Check out your portfolio center. Please also check ongoing floating volatility patterns of CREDIT IMMOBILIER and MAGHREBAIL.

Diversification Opportunities for CREDIT IMMOBILIER and MAGHREBAIL

0.5

Correlation Coefficient

CREDIT IMMOBILIER  MAGHREBAIL

Very weak diversification

The 3 months correlation between CREDIT and MAGHREBAIL is 0.5. Overlapping area represents the amount of risk that can be diversified away by holding CREDIT IMMOBILIER ET and MAGHREBAIL in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on MAGHREBAIL 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 MAGHREBAIL. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of MAGHREBAIL has no effect on the direction of CREDIT IMMOBILIER i.e., CREDIT IMMOBILIER and MAGHREBAIL go up and down completely randomly.

Pair Corralation between CREDIT IMMOBILIER and MAGHREBAIL

Assuming the 90 days trading horizon CREDIT IMMOBILIER ET is expected to generate 2.18 times more return on investment than MAGHREBAIL. However, CREDIT IMMOBILIER is 2.18 times more volatile than MAGHREBAIL. It trades about 0.03 of its potential returns per unit of risk. MAGHREBAIL is currently generating about 0.0 per unit of risk. If you would invest  40,600  in CREDIT IMMOBILIER ET on October 26, 2024 and sell it today you would earn a total of  900.00  from holding CREDIT IMMOBILIER ET or generate 2.22% return on investment over 90 days.

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

CREDIT IMMOBILIER ET  vs.  MAGHREBAIL

CREDIT IMMOBILIER

Risk-Adjusted Performance

2 of 100

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 recent stock price tumult, may contribute to shorter-term losses for the shareholders.

MAGHREBAIL

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days MAGHREBAIL has generated negative risk-adjusted returns adding no value to investors with long positions. Despite somewhat strong fundamental drivers, MAGHREBAIL is not utilizing all of its potentials. The current stock price disturbance, may contribute to short-term losses for the investors.

Pair Trading with CREDIT IMMOBILIER and MAGHREBAIL

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

The idea behind CREDIT IMMOBILIER ET and MAGHREBAIL 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 Sectors module to list of equity sectors categorizing publicly traded companies based on their primary business activities.