Correlation Between Veolia Environnement and AIM ImmunoTech
Can any of the company-specific risk be diversified away by investing in both Veolia Environnement and AIM ImmunoTech 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 Veolia Environnement and AIM ImmunoTech into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Veolia Environnement VE and AIM ImmunoTech, you can compare the effects of market volatilities on Veolia Environnement and AIM ImmunoTech 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 Veolia Environnement with a short position of AIM ImmunoTech. Check out your portfolio center. Please also check ongoing floating volatility patterns of Veolia Environnement and AIM ImmunoTech.
Diversification Opportunities for Veolia Environnement and AIM ImmunoTech
0.73 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Veolia and AIM is 0.73. Overlapping area represents the amount of risk that can be diversified away by holding Veolia Environnement VE and AIM ImmunoTech in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on AIM ImmunoTech and Veolia Environnement 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 Veolia Environnement VE are associated (or correlated) with AIM ImmunoTech. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of AIM ImmunoTech has no effect on the direction of Veolia Environnement i.e., Veolia Environnement and AIM ImmunoTech go up and down completely randomly.
Pair Corralation between Veolia Environnement and AIM ImmunoTech
Assuming the 90 days trading horizon Veolia Environnement VE is expected to generate 0.2 times more return on investment than AIM ImmunoTech. However, Veolia Environnement VE is 5.12 times less risky than AIM ImmunoTech. It trades about -0.24 of its potential returns per unit of risk. AIM ImmunoTech is currently generating about -0.09 per unit of risk. If you would invest 2,920 in Veolia Environnement VE on September 4, 2024 and sell it today you would lose (185.00) from holding Veolia Environnement VE or give up 6.34% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Veolia Environnement VE vs. AIM ImmunoTech
Performance |
| Timeline |
| Veolia Environnement |
| AIM ImmunoTech |
Veolia Environnement and AIM ImmunoTech Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Veolia Environnement and AIM ImmunoTech
The main advantage of trading using opposite Veolia Environnement and AIM ImmunoTech positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Veolia Environnement position performs unexpectedly, AIM ImmunoTech 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 AIM ImmunoTech will offset losses from the drop in AIM ImmunoTech's long position.| Veolia Environnement vs. Hansa Investment | Veolia Environnement vs. Martin Marietta Materials | Veolia Environnement vs. International Biotechnology Trust | Veolia Environnement vs. Morgan Advanced Materials |
| AIM ImmunoTech vs. Veolia Environnement VE | AIM ImmunoTech vs. Infrastrutture Wireless Italiane | AIM ImmunoTech vs. PureTech Health plc | AIM ImmunoTech vs. Seche Environnement SA |
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 Bond Analysis module to evaluate and analyze corporate bonds as a potential investment for your portfolios..
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