Correlation Between SPEAR Investments and Alfen Beheer

Can any of the company-specific risk be diversified away by investing in both SPEAR Investments and Alfen Beheer 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 SPEAR Investments and Alfen Beheer into the same portfolio, which is an essential part of the fundamental portfolio management process.

By analyzing existing cross correlation between SPEAR Investments I and Alfen Beheer BV, you can compare the effects of market volatilities on SPEAR Investments and Alfen Beheer 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 SPEAR Investments with a short position of Alfen Beheer. Check out your portfolio center. Please also check ongoing floating volatility patterns of SPEAR Investments and Alfen Beheer.

Diversification Opportunities for SPEAR Investments and Alfen Beheer

0.42

Correlation Coefficient

SPEAR Investments  Alfen Beheer

Very weak diversification

The 3 months correlation between SPEAR and Alfen is 0.42. Overlapping area represents the amount of risk that can be diversified away by holding SPEAR Investments I and Alfen Beheer BV in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Alfen Beheer BV and SPEAR Investments 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 SPEAR Investments I are associated (or correlated) with Alfen Beheer. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Alfen Beheer BV has no effect on the direction of SPEAR Investments i.e., SPEAR Investments and Alfen Beheer go up and down completely randomly.

Pair Corralation between SPEAR Investments and Alfen Beheer

Assuming the 90 days trading horizon SPEAR Investments I is expected to generate 0.24 times more return on investment than Alfen Beheer. However, SPEAR Investments I is 4.2 times less risky than Alfen Beheer. It trades about -0.1 of its potential returns per unit of risk. Alfen Beheer BV is currently generating about -0.07 per unit of risk. If you would invest  740.00  in SPEAR Investments I on April 23, 2025 and sell it today you would lose (50.00) from holding SPEAR Investments I or give up 6.76% of portfolio value over 90 days.

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

SPEAR Investments I  vs.  Alfen Beheer BV

SPEAR Investments

Risk-Adjusted Performance

Very Weak

Over the last 90 days SPEAR Investments I has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of latest uncertain performance, the Stock's basic indicators remain stable and the newest uproar on Wall Street may also be a sign of mid-term gains for the firm private investors.

Alfen Beheer BV

Risk-Adjusted Performance

Very Weak

Over the last 90 days Alfen Beheer BV has generated negative risk-adjusted returns adding no value to investors with long positions. Despite uncertain performance in the last few months, the Stock's basic indicators remain somewhat strong which may send shares a bit higher in August 2025. The current disturbance may also be a sign of long term up-swing for the company investors.

Pair Trading with SPEAR Investments and Alfen Beheer

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

The idea behind SPEAR Investments I and Alfen Beheer BV 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 Sync Your Broker module to sync your existing holdings, watchlists, positions or portfolios from thousands of online brokerage services, banks, investment account aggregators and robo-advisors..