Correlation Between X FAB and Gaztransport
Can any of the company-specific risk be diversified away by investing in both X FAB and Gaztransport 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 X FAB and Gaztransport into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between X FAB Silicon Foundries and Gaztransport et Technigaz, you can compare the effects of market volatilities on X FAB and Gaztransport 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 X FAB with a short position of Gaztransport. Check out your portfolio center. Please also check ongoing floating volatility patterns of X FAB and Gaztransport.
Diversification Opportunities for X FAB and Gaztransport
-0.66 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between 0ROZ and Gaztransport is -0.66. Overlapping area represents the amount of risk that can be diversified away by holding X FAB Silicon Foundries and Gaztransport et Technigaz in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Gaztransport et Technigaz and X FAB 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 X FAB Silicon Foundries are associated (or correlated) with Gaztransport. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Gaztransport et Technigaz has no effect on the direction of X FAB i.e., X FAB and Gaztransport go up and down completely randomly.
Pair Corralation between X FAB and Gaztransport
Assuming the 90 days trading horizon X FAB Silicon Foundries is expected to under-perform the Gaztransport. In addition to that, X FAB is 1.69 times more volatile than Gaztransport et Technigaz. It trades about -0.11 of its total potential returns per unit of risk. Gaztransport et Technigaz is currently generating about 0.04 per unit of volatility. If you would invest 12,899 in Gaztransport et Technigaz on September 1, 2024 and sell it today you would earn a total of 891.00 from holding Gaztransport et Technigaz or generate 6.91% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 99.23% |
| Values | Daily Returns |
X FAB Silicon Foundries vs. Gaztransport et Technigaz
Performance |
| Timeline |
| X FAB Silicon |
| Gaztransport et Technigaz |
X FAB and Gaztransport Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with X FAB and Gaztransport
The main advantage of trading using opposite X FAB and Gaztransport positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if X FAB position performs unexpectedly, Gaztransport 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 Gaztransport will offset losses from the drop in Gaztransport's long position.| X FAB vs. Gamma Communications PLC | X FAB vs. Dalata Hotel Group | X FAB vs. Zegona Communications Plc | X FAB vs. Gaztransport et Technigaz |
| Gaztransport vs. Uniper SE | Gaztransport vs. Mulberry Group PLC | Gaztransport vs. London Security Plc | Gaztransport vs. Triad Group PLC |
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 Competition Analyzer module to analyze and compare many basic indicators for a group of related or unrelated entities.
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