Correlation Between Khiron Life and Séché Environnement
Can any of the company-specific risk be diversified away by investing in both Khiron Life and Séché Environnement 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 Khiron Life and Séché Environnement into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Khiron Life Sciences and Sch Environnement SA, you can compare the effects of market volatilities on Khiron Life and Séché Environnement 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 Khiron Life with a short position of Séché Environnement. Check out your portfolio center. Please also check ongoing floating volatility patterns of Khiron Life and Séché Environnement.
Diversification Opportunities for Khiron Life and Séché Environnement
0.0 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between Khiron and Séché is 0.0. Overlapping area represents the amount of risk that can be diversified away by holding Khiron Life Sciences and Sch Environnement SA in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Séché Environnement and Khiron Life 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 Khiron Life Sciences are associated (or correlated) with Séché Environnement. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Séché Environnement has no effect on the direction of Khiron Life i.e., Khiron Life and Séché Environnement go up and down completely randomly.
Pair Corralation between Khiron Life and Séché Environnement
Assuming the 90 days trading horizon Khiron Life Sciences is expected to under-perform the Séché Environnement. In addition to that, Khiron Life is 1.94 times more volatile than Sch Environnement SA. It trades about -0.04 of its total potential returns per unit of risk. Sch Environnement SA is currently generating about -0.02 per unit of volatility. If you would invest 10,043 in Sch Environnement SA on October 14, 2024 and sell it today you would lose (2,283) from holding Sch Environnement SA or give up 22.73% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Flat |
| Strength | Insignificant |
| Accuracy | 99.8% |
| Values | Daily Returns |
Khiron Life Sciences vs. Sch Environnement SA
Performance |
| Timeline |
| Khiron Life Sciences |
| Séché Environnement |
Khiron Life and Séché Environnement Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Khiron Life and Séché Environnement
The main advantage of trading using opposite Khiron Life and Séché Environnement positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Khiron Life position performs unexpectedly, Séché Environnement 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 Séché Environnement will offset losses from the drop in Séché Environnement's long position.| Khiron Life vs. Universal Insurance Holdings | Khiron Life vs. SBI Insurance Group | Khiron Life vs. REVO INSURANCE SPA | Khiron Life vs. Sinopec Shanghai Petrochemical |
| Séché Environnement vs. EAGLE MATERIALS | Séché Environnement vs. Applied Materials | Séché Environnement vs. VULCAN MATERIALS | Séché Environnement vs. SILVER BULLET DATA |
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 Piotroski F Score module to get Piotroski F Score based on the binary analysis strategy of nine different fundamentals.
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