Correlation Between Intergroup and Vitania
Can any of the company-specific risk be diversified away by investing in both Intergroup and Vitania 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 Intergroup and Vitania into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between The Intergroup and Vitania, you can compare the effects of market volatilities on Intergroup and Vitania 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 Intergroup with a short position of Vitania. Check out your portfolio center. Please also check ongoing floating volatility patterns of Intergroup and Vitania.
Diversification Opportunities for Intergroup and Vitania
0.09 | Correlation Coefficient |
Significant diversification
The 3 months correlation between Intergroup and Vitania is 0.09. Overlapping area represents the amount of risk that can be diversified away by holding The Intergroup and Vitania in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Vitania and Intergroup 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 The Intergroup are associated (or correlated) with Vitania. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Vitania has no effect on the direction of Intergroup i.e., Intergroup and Vitania go up and down completely randomly.
Pair Corralation between Intergroup and Vitania
Given the investment horizon of 90 days The Intergroup is expected to under-perform the Vitania. In addition to that, Intergroup is 2.49 times more volatile than Vitania. It trades about -0.02 of its total potential returns per unit of risk. Vitania is currently generating about -0.03 per unit of volatility. If you would invest 205,900 in Vitania on December 30, 2023 and sell it today you would lose (3,400) from holding Vitania or give up 1.65% of portfolio value over 90 days.
Time Period | 3 Months [change] |
Direction | Moves Together |
Strength | Insignificant |
Accuracy | 86.36% |
Values | Daily Returns |
The Intergroup vs. Vitania
Performance |
Timeline |
Intergroup |
Vitania |
Intergroup and Vitania Volatility Contrast
Predicted Return Density |
Returns |
Pair Trading with Intergroup and Vitania
The main advantage of trading using opposite Intergroup and Vitania positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Intergroup position performs unexpectedly, Vitania 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 Vitania will offset losses from the drop in Vitania's long position.Intergroup vs. LuxUrban Hotels | Intergroup vs. Amer Sports | Intergroup vs. International Paper | Intergroup vs. J Long Group Limited |
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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 Global Correlations module to find global opportunities by holding instruments from different markets.
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