Correlation Between CSHG Imobiliario and Real Estate

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

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

Diversification Opportunities for CSHG Imobiliario and Real Estate

0.54

Correlation Coefficient

CSHG Imobiliario  Real Estate

Very weak diversification

The 3 months correlation between CSHG and Real is 0.54. Overlapping area represents the amount of risk that can be diversified away by holding CSHG Imobiliario Fof and Real Estate Investment in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Real Estate Investment and CSHG Imobiliario 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 Imobiliario Fof are associated (or correlated) with Real Estate. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Real Estate Investment has no effect on the direction of CSHG Imobiliario i.e., CSHG Imobiliario and Real Estate go up and down completely randomly.

Pair Corralation between CSHG Imobiliario and Real Estate

Assuming the 90 days trading horizon CSHG Imobiliario Fof is expected to generate 1.2 times more return on investment than Real Estate. However, CSHG Imobiliario is 1.2 times more volatile than Real Estate Investment. It trades about 0.11 of its potential returns per unit of risk. Real Estate Investment is currently generating about 0.13 per unit of risk. If you would invest  6,373  in CSHG Imobiliario Fof on December 23, 2024 and sell it today you would earn a total of  571.00  from holding CSHG Imobiliario Fof or generate 8.96% return on investment over 90 days.

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

CSHG Imobiliario Fof  vs.  Real Estate Investment

CSHG Imobiliario Fof

Risk-Adjusted Performance

OK

Compared to the overall equity markets, risk-adjusted returns on investments in CSHG Imobiliario Fof are ranked lower than 8 (%) of all funds and portfolios of funds over the last 90 days. Despite somewhat weak technical and fundamental indicators, CSHG Imobiliario may actually be approaching a critical reversion point that can send shares even higher in April 2025.

Real Estate Investment

Risk-Adjusted Performance

OK

Compared to the overall equity markets, risk-adjusted returns on investments in Real Estate Investment are ranked lower than 9 (%) of all funds and portfolios of funds over the last 90 days. Despite somewhat weak technical indicators, Real Estate may actually be approaching a critical reversion point that can send shares even higher in April 2025.

Pair Trading with CSHG Imobiliario and Real Estate

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

The idea behind CSHG Imobiliario Fof and Real Estate Investment 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 Positions Ratings module to determine portfolio positions ratings based on digital equity recommendations. Macroaxis instant position ratings are based on combination of fundamental analysis and risk-adjusted market performance.