Correlation Between CSHG Recebiveis and CSHG Real

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

By analyzing existing cross correlation between CSHG Recebiveis Imobiliarios and CSHG Real Estate, you can compare the effects of market volatilities on CSHG Recebiveis and CSHG Real 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 CSHG Recebiveis with a short position of CSHG Real. Check out your portfolio center. Please also check ongoing floating volatility patterns of CSHG Recebiveis and CSHG Real.

Diversification Opportunities for CSHG Recebiveis and CSHG Real

0.51

Correlation Coefficient

CSHG Recebiveis  CSHG Real

Very weak diversification

The 3 months correlation between CSHG and CSHG is 0.51. Overlapping area represents the amount of risk that can be diversified away by holding CSHG Recebiveis Imobiliarios and CSHG Real Estate in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on CSHG Real Estate and CSHG Recebiveis 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 CSHG Recebiveis Imobiliarios are associated (or correlated) with CSHG Real. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of CSHG Real Estate has no effect on the direction of CSHG Recebiveis i.e., CSHG Recebiveis and CSHG Real go up and down completely randomly.

Pair Corralation between CSHG Recebiveis and CSHG Real

Assuming the 90 days trading horizon CSHG Recebiveis Imobiliarios is expected to under-perform the CSHG Real. But the fund apears to be less risky and, when comparing its historical volatility, CSHG Recebiveis Imobiliarios is 1.24 times less risky than CSHG Real. The fund trades about -0.07 of its potential returns per unit of risk. The CSHG Real Estate is currently generating about -0.02 of returns per unit of risk over similar time horizon. If you would invest  10,088  in CSHG Real Estate on October 24, 2024 and sell it today you would lose (288.00) from holding CSHG Real Estate or give up 2.85% of portfolio value over 90 days.

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

CSHG Recebiveis Imobiliarios  vs.  CSHG Real Estate

CSHG Recebiveis Imob

Risk-Adjusted Performance

0 of 100

Very Weak

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

CSHG Real Estate

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days CSHG Real Estate has generated negative risk-adjusted returns adding no value to fund investors. Despite somewhat strong basic indicators, CSHG Real is not utilizing all of its potentials. The current stock price disturbance, may contribute to short-term losses for the investors.

Pair Trading with CSHG Recebiveis and CSHG Real

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

The idea behind CSHG Recebiveis Imobiliarios and CSHG Real Estate 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 Anywhere module to track or share privately all of your investments from the convenience of any device.