Correlation Between GIMV NV and Banimmo SA

Can any of the company-specific risk be diversified away by investing in both GIMV NV and Banimmo SA 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 GIMV NV and Banimmo SA into the same portfolio, which is an essential part of the fundamental portfolio management process.

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

Diversification Opportunities for GIMV NV and Banimmo SA

0.13

Correlation Coefficient

GIMV NV  Banimmo SA

Average diversification

The 3 months correlation between GIMV and Banimmo is 0.13. Overlapping area represents the amount of risk that can be diversified away by holding GIMV NV and Banimmo SA in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Banimmo SA and GIMV NV 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 GIMV NV are associated (or correlated) with Banimmo SA. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Banimmo SA has no effect on the direction of GIMV NV i.e., GIMV NV and Banimmo SA go up and down completely randomly.

Pair Corralation between GIMV NV and Banimmo SA

Assuming the 90 days trading horizon GIMV NV is expected to under-perform the Banimmo SA. In addition to that, GIMV NV is 1.25 times more volatile than Banimmo SA. It trades about 0.0 of its total potential returns per unit of risk. Banimmo SA is currently generating about 0.04 per unit of volatility. If you would invest  286.00  in Banimmo SA on December 22, 2024 and sell it today you would earn a total of  6.00  from holding Banimmo SA or generate 2.1% return on investment over 90 days.

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

GIMV NV  vs.  Banimmo SA

GIMV NV

Risk-Adjusted Performance

Very Weak

Over the last 90 days GIMV NV has generated negative risk-adjusted returns adding no value to investors with long positions. Even with relatively invariable basic indicators, GIMV NV is not utilizing all of its potentials. The latest stock price agitation, may contribute to short-term losses for the retail investors.

Banimmo SA

Risk-Adjusted Performance

Weak

Compared to the overall equity markets, risk-adjusted returns on investments in Banimmo SA are ranked lower than 2 (%) of all global equities and portfolios over the last 90 days. Even with relatively invariable basic indicators, Banimmo SA is not utilizing all of its potentials. The latest stock price agitation, may contribute to short-term losses for the retail investors.

Pair Trading with GIMV NV and Banimmo SA

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

The idea behind GIMV NV and Banimmo 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 Sync Your Broker module to sync your existing holdings, watchlists, positions or portfolios from thousands of online brokerage services, banks, investment account aggregators and robo-advisors..