Correlation Between Wereldhav and Cofinimmo

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

By analyzing existing cross correlation between Wereldhav B Sicafi and Cofinimmo SA, you can compare the effects of market volatilities on Wereldhav and Cofinimmo 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 Wereldhav with a short position of Cofinimmo. Check out your portfolio center. Please also check ongoing floating volatility patterns of Wereldhav and Cofinimmo.

Diversification Opportunities for Wereldhav and Cofinimmo

0.76

Correlation Coefficient

Wereldhav  Cofinimmo

Poor diversification

The 3 months correlation between Wereldhav and Cofinimmo is 0.76. Overlapping area represents the amount of risk that can be diversified away by holding Wereldhav B Sicafi and Cofinimmo SA in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Cofinimmo SA and Wereldhav 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 Wereldhav B Sicafi are associated (or correlated) with Cofinimmo. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Cofinimmo SA has no effect on the direction of Wereldhav i.e., Wereldhav and Cofinimmo go up and down completely randomly.

Pair Corralation between Wereldhav and Cofinimmo

Assuming the 90 days trading horizon Wereldhav B Sicafi is expected to generate 0.87 times more return on investment than Cofinimmo. However, Wereldhav B Sicafi is 1.15 times less risky than Cofinimmo. It trades about 0.16 of its potential returns per unit of risk. Cofinimmo SA is currently generating about 0.12 per unit of risk. If you would invest  4,550  in Wereldhav B Sicafi on December 26, 2024 and sell it today you would earn a total of  570.00  from holding Wereldhav B Sicafi or generate 12.53% return on investment over 90 days.

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

Wereldhav B Sicafi  vs.  Cofinimmo SA

Wereldhav B Sicafi

Risk-Adjusted Performance

Good

Compared to the overall equity markets, risk-adjusted returns on investments in Wereldhav B Sicafi are ranked lower than 12 (%) of all global equities and portfolios over the last 90 days. Even with relatively weak basic indicators, Wereldhav may actually be approaching a critical reversion point that can send shares even higher in April 2025.

Cofinimmo SA

Risk-Adjusted Performance

OK

Compared to the overall equity markets, risk-adjusted returns on investments in Cofinimmo SA are ranked lower than 9 (%) of all global equities and portfolios over the last 90 days. Even with relatively weak basic indicators, Cofinimmo may actually be approaching a critical reversion point that can send shares even higher in April 2025.

Pair Trading with Wereldhav and Cofinimmo

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

The idea behind Wereldhav B Sicafi and Cofinimmo SA 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 Investing Opportunities module to build portfolios using our predefined set of ideas and optimize them against your investing preferences.