Correlation Between Allreal Holding and Forbo Holding

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

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

Diversification Opportunities for Allreal Holding and Forbo Holding

-0.16

Correlation Coefficient

Allreal Holding  Forbo Holding

Good diversification

The 3 months correlation between Allreal and Forbo is -0.16. Overlapping area represents the amount of risk that can be diversified away by holding Allreal Holding and Forbo Holding AG in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Forbo Holding AG and Allreal Holding 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 Allreal Holding are associated (or correlated) with Forbo Holding. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Forbo Holding AG has no effect on the direction of Allreal Holding i.e., Allreal Holding and Forbo Holding go up and down completely randomly.

Pair Corralation between Allreal Holding and Forbo Holding

Assuming the 90 days trading horizon Allreal Holding is expected to generate 0.29 times more return on investment than Forbo Holding. However, Allreal Holding is 3.48 times less risky than Forbo Holding. It trades about -0.06 of its potential returns per unit of risk. Forbo Holding AG is currently generating about -0.02 per unit of risk. If you would invest  18,840  in Allreal Holding on May 21, 2025 and sell it today you would lose (520.00) from holding Allreal Holding or give up 2.76% of portfolio value over 90 days.

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

Allreal Holding  vs.  Forbo Holding AG

Allreal Holding

Risk-Adjusted Performance

Weakest

Over the last 90 days Allreal Holding has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of fairly stable basic indicators, Allreal Holding is not utilizing all of its potentials. The latest stock price fuss, may contribute to near-short-term losses for the sophisticated investors.

Forbo Holding AG

Risk-Adjusted Performance

Weakest

Over the last 90 days Forbo Holding AG has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of fairly stable basic indicators, Forbo Holding is not utilizing all of its potentials. The latest stock price fuss, may contribute to near-short-term losses for the sophisticated investors.

Pair Trading with Allreal Holding and Forbo Holding

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

The idea behind Allreal Holding and Forbo Holding 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 Portfolio Optimization module to compute new portfolio that will generate highest expected return given your specified tolerance for risk.