Correlation Between COFCO Joycome and Crédit Agricole
Can any of the company-specific risk be diversified away by investing in both COFCO Joycome and Crédit Agricole 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 COFCO Joycome and Crédit Agricole into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between COFCO Joycome Foods and Crdit Agricole SA, you can compare the effects of market volatilities on COFCO Joycome and Crédit Agricole 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 COFCO Joycome with a short position of Crédit Agricole. Check out your portfolio center. Please also check ongoing floating volatility patterns of COFCO Joycome and Crédit Agricole.
Diversification Opportunities for COFCO Joycome and Crédit Agricole
-0.36 | Correlation Coefficient |
Very good diversification
The 3 months correlation between COFCO and Crédit is -0.36. Overlapping area represents the amount of risk that can be diversified away by holding COFCO Joycome Foods and Crdit Agricole SA in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Crdit Agricole SA and COFCO Joycome 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 COFCO Joycome Foods are associated (or correlated) with Crédit Agricole. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Crdit Agricole SA has no effect on the direction of COFCO Joycome i.e., COFCO Joycome and Crédit Agricole go up and down completely randomly.
Pair Corralation between COFCO Joycome and Crédit Agricole
Assuming the 90 days horizon COFCO Joycome Foods is expected to under-perform the Crédit Agricole. In addition to that, COFCO Joycome is 2.37 times more volatile than Crdit Agricole SA. It trades about -0.02 of its total potential returns per unit of risk. Crdit Agricole SA is currently generating about 0.03 per unit of volatility. If you would invest 1,175 in Crdit Agricole SA on September 4, 2024 and sell it today you would earn a total of 78.00 from holding Crdit Agricole SA or generate 6.64% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
COFCO Joycome Foods vs. Crdit Agricole SA
Performance |
| Timeline |
| COFCO Joycome Foods |
| Crdit Agricole SA |
COFCO Joycome and Crédit Agricole Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with COFCO Joycome and Crédit Agricole
The main advantage of trading using opposite COFCO Joycome and Crédit Agricole positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if COFCO Joycome position performs unexpectedly, Crédit Agricole 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 Crédit Agricole will offset losses from the drop in Crédit Agricole's long position.The idea behind COFCO Joycome Foods and Crdit Agricole SA 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.| Crédit Agricole vs. Japan Tobacco | Crédit Agricole vs. Charter Communications | Crédit Agricole vs. United Natural Foods | Crédit Agricole vs. COFCO Joycome Foods |
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 Price Exposure Probability module to analyze equity upside and downside potential for a given time horizon across multiple markets.
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