Correlation Between ALM Equity and Corem Property

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

By analyzing existing cross correlation between ALM Equity AB and Corem Property Group, you can compare the effects of market volatilities on ALM Equity and Corem Property 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 ALM Equity with a short position of Corem Property. Check out your portfolio center. Please also check ongoing floating volatility patterns of ALM Equity and Corem Property.

Diversification Opportunities for ALM Equity and Corem Property

0.0

Correlation Coefficient

ALM Equity  Corem Property

Pay attention - limited upside

The 3 months correlation between ALM and Corem is 0.0. Overlapping area represents the amount of risk that can be diversified away by holding ALM Equity AB and Corem Property Group in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Corem Property Group and ALM Equity 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 ALM Equity AB are associated (or correlated) with Corem Property. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Corem Property Group has no effect on the direction of ALM Equity i.e., ALM Equity and Corem Property go up and down completely randomly.

Pair Corralation between ALM Equity and Corem Property

If you would invest  20,734  in Corem Property Group on April 22, 2025 and sell it today you would earn a total of  2,966  from holding Corem Property Group or generate 14.31% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Flat
Strength	Insignificant
Accuracy	1.64%
Values	Daily Returns

ALM Equity AB  vs.  Corem Property Group

ALM Equity AB

Risk-Adjusted Performance

Very Weak

Over the last 90 days ALM Equity AB has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of comparatively stable primary indicators, ALM Equity is not utilizing all of its potentials. The current stock price uproar, may contribute to short-horizon losses for the private investors.

Corem Property Group

Risk-Adjusted Performance

Solid

Compared to the overall equity markets, risk-adjusted returns on investments in Corem Property Group are ranked lower than 16 (%) of all global equities and portfolios over the last 90 days. Even with relatively weak basic indicators, Corem Property reported solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with ALM Equity and Corem Property

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

The idea behind ALM Equity AB and Corem Property Group 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 Risk-Return Analysis module to view associations between returns expected from investment and the risk you assume.