Correlation Between Fnac Darty and CEOTRONICS (CEKSG)
Can any of the company-specific risk be diversified away by investing in both Fnac Darty and CEOTRONICS (CEKSG) 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 Fnac Darty and CEOTRONICS (CEKSG) into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Fnac Darty SA and CEOTRONICS, you can compare the effects of market volatilities on Fnac Darty and CEOTRONICS (CEKSG) 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 Fnac Darty with a short position of CEOTRONICS (CEKSG). Check out your portfolio center. Please also check ongoing floating volatility patterns of Fnac Darty and CEOTRONICS (CEKSG).
Diversification Opportunities for Fnac Darty and CEOTRONICS (CEKSG)
-0.25 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Fnac and CEOTRONICS is -0.25. Overlapping area represents the amount of risk that can be diversified away by holding Fnac Darty SA and CEOTRONICS in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on CEOTRONICS (CEKSG) and Fnac Darty 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 Fnac Darty SA are associated (or correlated) with CEOTRONICS (CEKSG). Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of CEOTRONICS (CEKSG) has no effect on the direction of Fnac Darty i.e., Fnac Darty and CEOTRONICS (CEKSG) go up and down completely randomly.
Pair Corralation between Fnac Darty and CEOTRONICS (CEKSG)
Assuming the 90 days horizon Fnac Darty SA is expected to under-perform the CEOTRONICS (CEKSG). But the stock apears to be less risky and, when comparing its historical volatility, Fnac Darty SA is 1.1 times less risky than CEOTRONICS (CEKSG). The stock trades about -0.01 of its potential returns per unit of risk. The CEOTRONICS is currently generating about 0.02 of returns per unit of risk over similar time horizon. If you would invest 446.00 in CEOTRONICS on August 27, 2024 and sell it today you would earn a total of 64.00 from holding CEOTRONICS or generate 14.35% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Fnac Darty SA vs. CEOTRONICS
Performance |
| Timeline |
| Fnac Darty SA |
| CEOTRONICS (CEKSG) |
Fnac Darty and CEOTRONICS (CEKSG) Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Fnac Darty and CEOTRONICS (CEKSG)
The main advantage of trading using opposite Fnac Darty and CEOTRONICS (CEKSG) positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Fnac Darty position performs unexpectedly, CEOTRONICS (CEKSG) 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 CEOTRONICS (CEKSG) will offset losses from the drop in CEOTRONICS (CEKSG)'s long position.| Fnac Darty vs. CEOTRONICS | Fnac Darty vs. SWISS WATER DECAFFCOFFEE | Fnac Darty vs. Coor Service Management | Fnac Darty vs. Q2M Managementberatung AG |
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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 Theme Ratings module to determine theme ratings based on digital equity recommendations. Macroaxis theme ratings are based on combination of fundamental analysis and risk-adjusted market performance.
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