Correlation Between Merlin Properties and Iffe Futura
Can any of the company-specific risk be diversified away by investing in both Merlin Properties and Iffe Futura 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 Merlin Properties and Iffe Futura into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Merlin Properties SOCIMI and Iffe Futura SA, you can compare the effects of market volatilities on Merlin Properties and Iffe Futura 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 Merlin Properties with a short position of Iffe Futura. Check out your portfolio center. Please also check ongoing floating volatility patterns of Merlin Properties and Iffe Futura.
Diversification Opportunities for Merlin Properties and Iffe Futura
0.88 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between Merlin and Iffe is 0.88. Overlapping area represents the amount of risk that can be diversified away by holding Merlin Properties SOCIMI and Iffe Futura SA in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Iffe Futura SA and Merlin Properties 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 Merlin Properties SOCIMI are associated (or correlated) with Iffe Futura. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Iffe Futura SA has no effect on the direction of Merlin Properties i.e., Merlin Properties and Iffe Futura go up and down completely randomly.
Pair Corralation between Merlin Properties and Iffe Futura
Assuming the 90 days trading horizon Merlin Properties SOCIMI is expected to generate 0.57 times more return on investment than Iffe Futura. However, Merlin Properties SOCIMI is 1.75 times less risky than Iffe Futura. It trades about 0.3 of its potential returns per unit of risk. Iffe Futura SA is currently generating about 0.15 per unit of risk. If you would invest 966.00 in Merlin Properties SOCIMI on April 22, 2025 and sell it today you would earn a total of 182.00 from holding Merlin Properties SOCIMI or generate 18.84% return on investment over 90 days.
Time Period | 3 Months [change] |
Direction | Moves Together |
Strength | Strong |
Accuracy | 100.0% |
Values | Daily Returns |
Merlin Properties SOCIMI vs. Iffe Futura SA
Performance |
Timeline |
Merlin Properties SOCIMI |
Iffe Futura SA |
Merlin Properties and Iffe Futura Volatility Contrast
Predicted Return Density |
Returns |
Pair Trading with Merlin Properties and Iffe Futura
The main advantage of trading using opposite Merlin Properties and Iffe Futura positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Merlin Properties position performs unexpectedly, Iffe Futura 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 Iffe Futura will offset losses from the drop in Iffe Futura's long position.Merlin Properties vs. Atresmedia Corporacin de | Merlin Properties vs. Naturhouse Health SA | Merlin Properties vs. Home Capital Rentals | Merlin Properties vs. Ebro Foods |
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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 Piotroski F Score module to get Piotroski F Score based on the binary analysis strategy of nine different fundamentals.
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