Correlation Between Vastned Retail and Bever Holding

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

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

Diversification Opportunities for Vastned Retail and Bever Holding

-0.8

Correlation Coefficient

Vastned Retail  Bever Holding

Pay attention - limited upside

The 3 months correlation between Vastned and Bever is -0.8. Overlapping area represents the amount of risk that can be diversified away by holding Vastned Retail NV and Bever Holding NV in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Bever Holding NV and Vastned Retail 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 Vastned Retail NV are associated (or correlated) with Bever Holding. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Bever Holding NV has no effect on the direction of Vastned Retail i.e., Vastned Retail and Bever Holding go up and down completely randomly.

Pair Corralation between Vastned Retail and Bever Holding

Assuming the 90 days trading horizon Vastned Retail NV is expected to generate 0.36 times more return on investment than Bever Holding. However, Vastned Retail NV is 2.76 times less risky than Bever Holding. It trades about 0.12 of its potential returns per unit of risk. Bever Holding NV is currently generating about -0.05 per unit of risk. If you would invest  1,819  in Vastned Retail NV on February 6, 2024 and sell it today you would earn a total of  341.00  from holding Vastned Retail NV or generate 18.75% return on investment over 90 days.

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

Vastned Retail NV  vs.  Bever Holding NV

Vastned Retail NV

Risk-Adjusted Performance

15 of 100

Good

Compared to the overall equity markets, risk-adjusted returns on investments in Vastned Retail NV are ranked lower than 15 (%) of all global equities and portfolios over the last 90 days. Despite somewhat weak basic indicators, Vastned Retail sustained solid returns over the last few months and may actually be approaching a breakup point.

Bever Holding NV

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Bever Holding NV has generated negative risk-adjusted returns adding no value to investors with long positions. Despite latest uncertain performance, the Stock's basic indicators remain strong and the current disturbance on Wall Street may also be a sign of long term gains for the company investors.

Pair Trading with Vastned Retail and Bever Holding

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

The idea behind Vastned Retail NV and Bever Holding 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.

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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.