Correlation Between Granite 3x and Multi Units
Can any of the company-specific risk be diversified away by investing in both Granite 3x and Multi Units 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 Granite 3x and Multi Units into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Granite 3x LVMH and Multi Units France, you can compare the effects of market volatilities on Granite 3x and Multi Units 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 Granite 3x with a short position of Multi Units. Check out your portfolio center. Please also check ongoing floating volatility patterns of Granite 3x and Multi Units.
Diversification Opportunities for Granite 3x and Multi Units
-0.27 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Granite and Multi is -0.27. Overlapping area represents the amount of risk that can be diversified away by holding Granite 3x LVMH and Multi Units France in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Multi Units France and Granite 3x 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 Granite 3x LVMH are associated (or correlated) with Multi Units. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Multi Units France has no effect on the direction of Granite 3x i.e., Granite 3x and Multi Units go up and down completely randomly.
Pair Corralation between Granite 3x and Multi Units
Assuming the 90 days trading horizon Granite 3x LVMH is expected to under-perform the Multi Units. In addition to that, Granite 3x is 4.83 times more volatile than Multi Units France. It trades about -0.02 of its total potential returns per unit of risk. Multi Units France is currently generating about -0.05 per unit of volatility. If you would invest 3,853 in Multi Units France on September 2, 2024 and sell it today you would lose (1,088) from holding Multi Units France or give up 28.24% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 70.36% |
| Values | Daily Returns |
Granite 3x LVMH vs. Multi Units France
Performance |
| Timeline |
| Granite 3x LVMH |
| Multi Units France |
Granite 3x and Multi Units Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Granite 3x and Multi Units
The main advantage of trading using opposite Granite 3x and Multi Units positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Granite 3x position performs unexpectedly, Multi Units 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 Multi Units will offset losses from the drop in Multi Units' long position.The idea behind Granite 3x LVMH and Multi Units France 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.| Multi Units vs. Manitou BF SA | Multi Units vs. Granite 3x LVMH | Multi Units vs. 21Shares Polkadot ETP | Multi Units vs. Ekinops 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 Portfolio Center module to all portfolio management and optimization tools to improve performance of your portfolios.
Other Complementary Tools
| Stock Tickers Use high-impact, comprehensive, and customizable stock tickers that can be easily integrated to any websites | |
| Bollinger Bands Use Bollinger Bands indicator to analyze target price for a given investing horizon | |
| Performance Analysis Check effects of mean-variance optimization against your current asset allocation | |
| Theme Ratings Determine theme ratings based on digital equity recommendations. Macroaxis theme ratings are based on combination of fundamental analysis and risk-adjusted market performance | |
| Portfolio Volatility Check portfolio volatility and analyze historical return density to properly model market risk |