Correlation Between Infimer and Argo Properties

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

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

Diversification Opportunities for Infimer and Argo Properties

0.39

Correlation Coefficient

Infimer  Argo Properties

Weak diversification

The 3 months correlation between Infimer and Argo is 0.39. Overlapping area represents the amount of risk that can be diversified away by holding Infimer and Argo Properties NV in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Argo Properties NV and Infimer 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 Infimer are associated (or correlated) with Argo Properties. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Argo Properties NV has no effect on the direction of Infimer i.e., Infimer and Argo Properties go up and down completely randomly.

Pair Corralation between Infimer and Argo Properties

Assuming the 90 days trading horizon Infimer is expected to generate 7.96 times more return on investment than Argo Properties. However, Infimer is 7.96 times more volatile than Argo Properties NV. It trades about 0.07 of its potential returns per unit of risk. Argo Properties NV is currently generating about 0.03 per unit of risk. If you would invest  9,637  in Infimer on December 30, 2024 and sell it today you would lose (635.00) from holding Infimer or give up 6.59% of portfolio value over 90 days.

Time Period	3 Months [change]
Direction	Moves Together
Strength	Very Weak
Accuracy	84.62%
Values	Daily Returns

Infimer  vs.  Argo Properties NV

Infimer

Risk-Adjusted Performance

Modest

Over the last 90 days Infimer has generated negative risk-adjusted returns adding no value to investors with long positions. Despite somewhat weak technical and fundamental indicators, Infimer sustained solid returns over the last few months and may actually be approaching a breakup point.

Argo Properties NV

Risk-Adjusted Performance

Weak

Compared to the overall equity markets, risk-adjusted returns on investments in Argo Properties NV are ranked lower than 2 (%) of all global equities and portfolios over the last 90 days. Despite somewhat strong basic indicators, Argo Properties is not utilizing all of its potentials. The current stock price disturbance, may contribute to short-term losses for the investors.

Pair Trading with Infimer and Argo Properties

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

The idea behind Infimer and Argo Properties NV 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 Stock Screener module to find equities using a custom stock filter or screen asymmetry in trading patterns, price, volume, or investment outlook..