Correlation Between Azaria Rental and Cellnex Telecom

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

By analyzing existing cross correlation between Azaria Rental SOCIMI and Cellnex Telecom SA, you can compare the effects of market volatilities on Azaria Rental and Cellnex Telecom 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 Azaria Rental with a short position of Cellnex Telecom. Check out your portfolio center. Please also check ongoing floating volatility patterns of Azaria Rental and Cellnex Telecom.

Diversification Opportunities for Azaria Rental and Cellnex Telecom

-0.47

Correlation Coefficient

Azaria Rental  Cellnex Telecom

Very good diversification

The 3 months correlation between Azaria and Cellnex is -0.47. Overlapping area represents the amount of risk that can be diversified away by holding Azaria Rental SOCIMI and Cellnex Telecom SA in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Cellnex Telecom SA and Azaria Rental 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 Azaria Rental SOCIMI are associated (or correlated) with Cellnex Telecom. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Cellnex Telecom SA has no effect on the direction of Azaria Rental i.e., Azaria Rental and Cellnex Telecom go up and down completely randomly.

Pair Corralation between Azaria Rental and Cellnex Telecom

Assuming the 90 days trading horizon Azaria Rental SOCIMI is expected to under-perform the Cellnex Telecom. But the stock apears to be less risky and, when comparing its historical volatility, Azaria Rental SOCIMI is 3.97 times less risky than Cellnex Telecom. The stock trades about -0.11 of its potential returns per unit of risk. The Cellnex Telecom SA is currently generating about 0.08 of returns per unit of risk over similar time horizon. If you would invest  3,045  in Cellnex Telecom SA on December 28, 2024 and sell it today you would earn a total of  274.00  from holding Cellnex Telecom SA or generate 9.0% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Against
Strength	Very Weak
Accuracy	98.44%
Values	Daily Returns

Azaria Rental SOCIMI  vs.  Cellnex Telecom SA

Azaria Rental SOCIMI

Risk-Adjusted Performance

Very Weak

Over the last 90 days Azaria Rental SOCIMI has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of rather sound fundamental indicators, Azaria Rental is not utilizing all of its potentials. The latest stock price tumult, may contribute to shorter-term losses for the shareholders.

Cellnex Telecom SA

Risk-Adjusted Performance

Modest

Compared to the overall equity markets, risk-adjusted returns on investments in Cellnex Telecom SA are ranked lower than 6 (%) of all global equities and portfolios over the last 90 days. In spite of rather unsteady fundamental indicators, Cellnex Telecom may actually be approaching a critical reversion point that can send shares even higher in April 2025.

Pair Trading with Azaria Rental and Cellnex Telecom

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

The idea behind Azaria Rental SOCIMI and Cellnex Telecom 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 Stock Tickers module to use high-impact, comprehensive, and customizable stock tickers that can be easily integrated to any websites.