Correlation Between Mivne Real and Argo Properties

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

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

Diversification Opportunities for Mivne Real and Argo Properties

-0.09

Correlation Coefficient

Mivne Real  Argo Properties

Good diversification

The 3 months correlation between Mivne and Argo is -0.09. Overlapping area represents the amount of risk that can be diversified away by holding Mivne Real Estate 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 Mivne 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 Mivne Real Estate 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 Mivne Real i.e., Mivne Real and Argo Properties go up and down completely randomly.

Pair Corralation between Mivne Real and Argo Properties

Assuming the 90 days trading horizon Mivne Real Estate is expected to under-perform the Argo Properties. But the stock apears to be less risky and, when comparing its historical volatility, Mivne Real Estate is 1.25 times less risky than Argo Properties. The stock trades about -0.01 of its potential returns per unit of risk. The Argo Properties NV is currently generating about 0.08 of returns per unit of risk over similar time horizon. If you would invest  1,025,000  in Argo Properties NV on December 4, 2024 and sell it today you would earn a total of  75,000  from holding Argo Properties NV or generate 7.32% return on investment over 90 days.

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

Mivne Real Estate  vs.  Argo Properties NV

Mivne Real Estate

Risk-Adjusted Performance

Very Weak

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

Argo Properties NV

Risk-Adjusted Performance

Modest

Compared to the overall equity markets, risk-adjusted returns on investments in Argo Properties NV are ranked lower than 6 (%) of all global equities and portfolios over the last 90 days. Despite somewhat weak basic indicators, Argo Properties may actually be approaching a critical reversion point that can send shares even higher in April 2025.

Pair Trading with Mivne Real and Argo Properties

The main advantage of trading using opposite Mivne Real and Argo Properties positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Mivne Real 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 Mivne Real Estate 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 Portfolio Diagnostics module to use generated alerts and portfolio events aggregator to diagnose current holdings.