Correlation Between Real Estate and CSHG Imobiliario

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

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

Diversification Opportunities for Real Estate and CSHG Imobiliario

0.92

Correlation Coefficient

Real Estate  CSHG Imobiliario

Almost no diversification

The 3 months correlation between Real and CSHG is 0.92. Overlapping area represents the amount of risk that can be diversified away by holding Real Estate Investment 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 Real Estate 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 Real Estate Investment 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 Real Estate i.e., Real Estate and CSHG Imobiliario go up and down completely randomly.

Pair Corralation between Real Estate and CSHG Imobiliario

Assuming the 90 days trading horizon Real Estate Investment is expected to under-perform the CSHG Imobiliario. But the fund apears to be less risky and, when comparing its historical volatility, Real Estate Investment is 1.01 times less risky than CSHG Imobiliario. The fund trades about -0.08 of its potential returns per unit of risk. The CSHG Imobiliario Fof is currently generating about -0.06 of returns per unit of risk over similar time horizon. If you would invest  7,269  in CSHG Imobiliario Fof on October 9, 2024 and sell it today you would lose (406.00) from holding CSHG Imobiliario Fof or give up 5.59% of portfolio value over 90 days.

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

Real Estate Investment  vs.  CSHG Imobiliario Fof

Real Estate Investment

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Real Estate Investment has generated negative risk-adjusted returns adding no value to fund investors. Despite latest weak performance, the Fund's technical indicators remain strong and the current disturbance on Wall Street may also be a sign of long term gains for the fund 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 Real Estate and CSHG Imobiliario

The main advantage of trading using opposite Real Estate and CSHG Imobiliario positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Real Estate 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 Real Estate Investment 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 Top Crypto Exchanges module to search and analyze digital assets across top global cryptocurrency exchanges.