Correlation Between CSHG Real and CSHG Imobiliario

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

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

Diversification Opportunities for CSHG Real and CSHG Imobiliario

0.75

Correlation Coefficient

CSHG Real  CSHG Imobiliario

Poor diversification

The 3 months correlation between CSHG and CSHG is 0.75. Overlapping area represents the amount of risk that can be diversified away by holding CSHG Real Estate and CSHG Imobiliario Fof in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on CSHG Imobiliario Fof and CSHG Real 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 Real Estate are associated (or correlated) with CSHG Imobiliario. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of CSHG Imobiliario Fof has no effect on the direction of CSHG Real i.e., CSHG Real and CSHG Imobiliario go up and down completely randomly.

Pair Corralation between CSHG Real and CSHG Imobiliario

Assuming the 90 days trading horizon CSHG Real Estate is expected to generate 1.18 times more return on investment than CSHG Imobiliario. However, CSHG Real is 1.18 times more volatile than CSHG Imobiliario Fof. It trades about 0.0 of its potential returns per unit of risk. CSHG Imobiliario Fof is currently generating about -0.06 per unit of risk. If you would invest  10,044  in CSHG Real Estate on October 9, 2024 and sell it today you would lose (30.00) from holding CSHG Real Estate or give up 0.3% of portfolio value over 90 days.

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

CSHG Real Estate  vs.  CSHG Imobiliario Fof

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.

CSHG Imobiliario Fof

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days CSHG Imobiliario Fof has generated negative risk-adjusted returns adding no value to fund investors. Despite somewhat strong technical and fundamental indicators, CSHG Imobiliario 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 Real and CSHG Imobiliario

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

The idea behind CSHG Real Estate and CSHG Imobiliario Fof 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 Financial Widgets module to easily integrated Macroaxis content with over 30 different plug-and-play financial widgets.