Correlation Between VGP NV and Immo Mcc

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

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

Diversification Opportunities for VGP NV and Immo Mcc

0.53

Correlation Coefficient

VGP NV  Immo Mcc

Very weak diversification

The 3 months correlation between VGP and Immo is 0.53. Overlapping area represents the amount of risk that can be diversified away by holding VGP NV and Immo Mcc NV in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Immo Mcc NV and VGP NV 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 VGP NV are associated (or correlated) with Immo Mcc. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Immo Mcc NV has no effect on the direction of VGP NV i.e., VGP NV and Immo Mcc go up and down completely randomly.

Pair Corralation between VGP NV and Immo Mcc

Assuming the 90 days trading horizon VGP NV is expected to generate 1.43 times more return on investment than Immo Mcc. However, VGP NV is 1.43 times more volatile than Immo Mcc NV. It trades about 0.33 of its potential returns per unit of risk. Immo Mcc NV is currently generating about 0.01 per unit of risk. If you would invest  6,960  in VGP NV on October 24, 2024 and sell it today you would earn a total of  690.00  from holding VGP NV or generate 9.91% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Together
Strength	Weak
Accuracy	95.0%
Values	Daily Returns

VGP NV  vs.  Immo Mcc NV

VGP NV

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days VGP NV has generated negative risk-adjusted returns adding no value to investors with long positions. Even with relatively invariable basic indicators, VGP NV is not utilizing all of its potentials. The latest stock price agitation, may contribute to short-term losses for the retail investors.

Immo Mcc NV

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Immo Mcc NV has generated negative risk-adjusted returns adding no value to investors with long positions. Even with latest weak performance, the Stock's fundamental indicators remain invariable and the latest agitation on Wall Street may also be a sign of long-running gains for the enterprise retail investors.

Pair Trading with VGP NV and Immo Mcc

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

The idea behind VGP NV and Immo Mcc 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.

Check out your portfolio center.

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 Odds Of Bankruptcy module to get analysis of equity chance of financial distress in the next 2 years.