Correlation Between HIAG Immobilien and Orior AG

Can any of the company-specific risk be diversified away by investing in both HIAG Immobilien and Orior AG 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 HIAG Immobilien and Orior AG into the same portfolio, which is an essential part of the fundamental portfolio management process.

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

Diversification Opportunities for HIAG Immobilien and Orior AG

-0.32

Correlation Coefficient

HIAG Immobilien  Orior AG

Very good diversification

The 3 months correlation between HIAG and Orior is -0.32. Overlapping area represents the amount of risk that can be diversified away by holding HIAG Immobilien Holding and Orior AG in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Orior AG and HIAG Immobilien 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 HIAG Immobilien Holding are associated (or correlated) with Orior AG. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Orior AG has no effect on the direction of HIAG Immobilien i.e., HIAG Immobilien and Orior AG go up and down completely randomly.

Pair Corralation between HIAG Immobilien and Orior AG

Assuming the 90 days trading horizon HIAG Immobilien Holding is expected to generate 0.31 times more return on investment than Orior AG. However, HIAG Immobilien Holding is 3.21 times less risky than Orior AG. It trades about 0.16 of its potential returns per unit of risk. Orior AG is currently generating about -0.17 per unit of risk. If you would invest  7,840  in HIAG Immobilien Holding on September 5, 2024 and sell it today you would earn a total of  500.00  from holding HIAG Immobilien Holding or generate 6.38% return on investment over 90 days.

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

HIAG Immobilien Holding  vs.  Orior AG

HIAG Immobilien Holding

Risk-Adjusted Performance

12 of 100

Good

Compared to the overall equity markets, risk-adjusted returns on investments in HIAG Immobilien Holding are ranked lower than 12 (%) of all global equities and portfolios over the last 90 days. In spite of fairly stable basic indicators, HIAG Immobilien is not utilizing all of its potentials. The latest stock price fuss, may contribute to near-short-term losses for the sophisticated investors.

Orior AG

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Orior AG has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of abnormal performance in the last few months, the Stock's basic indicators remain fairly stable which may send shares a bit higher in January 2025. The latest fuss may also be a sign of long-term up-swing for the venture sophisticated investors.

Pair Trading with HIAG Immobilien and Orior AG

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

The idea behind HIAG Immobilien Holding and Orior AG 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 ETFs module to find actively traded Exchange Traded Funds (ETF) from around the world.