Correlation Between Seche Environnement and Baker Steel
Can any of the company-specific risk be diversified away by investing in both Seche Environnement and Baker Steel 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 Seche Environnement and Baker Steel into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Seche Environnement SA and Baker Steel Resources, you can compare the effects of market volatilities on Seche Environnement and Baker Steel 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 Seche Environnement with a short position of Baker Steel. Check out your portfolio center. Please also check ongoing floating volatility patterns of Seche Environnement and Baker Steel.
Diversification Opportunities for Seche Environnement and Baker Steel
0.37 | Correlation Coefficient |
Weak diversification
The 3 months correlation between Seche and Baker is 0.37. Overlapping area represents the amount of risk that can be diversified away by holding Seche Environnement SA and Baker Steel Resources in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Baker Steel Resources and Seche 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 Seche Environnement SA are associated (or correlated) with Baker Steel. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Baker Steel Resources has no effect on the direction of Seche Environnement i.e., Seche Environnement and Baker Steel go up and down completely randomly.
Pair Corralation between Seche Environnement and Baker Steel
Assuming the 90 days trading horizon Seche Environnement SA is expected to under-perform the Baker Steel. In addition to that, Seche Environnement is 1.21 times more volatile than Baker Steel Resources. It trades about -0.01 of its total potential returns per unit of risk. Baker Steel Resources is currently generating about 0.03 per unit of volatility. If you would invest 4,750 in Baker Steel Resources on January 18, 2025 and sell it today you would earn a total of 200.00 from holding Baker Steel Resources or generate 4.21% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Seche Environnement SA vs. Baker Steel Resources
Performance |
| Timeline |
| Seche Environnement |
| Baker Steel Resources |
Seche Environnement and Baker Steel Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Seche Environnement and Baker Steel
The main advantage of trading using opposite Seche Environnement and Baker Steel positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Seche Environnement position performs unexpectedly, Baker Steel 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 Baker Steel will offset losses from the drop in Baker Steel's long position.| Seche Environnement vs. Wheaton Precious Metals | Seche Environnement vs. Gaztransport et Technigaz | Seche Environnement vs. METALL ZUG AG | Seche Environnement vs. Cornish Metals |
| Baker Steel vs. MyHealthChecked Plc | Baker Steel vs. Zegona Communications Plc | Baker Steel vs. Bellevue Healthcare Trust | Baker Steel vs. JB Hunt Transport |
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 Companies Directory module to evaluate performance of over 100,000 Stocks, Funds, and ETFs against different fundamentals.
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