Correlation Between LIFE + and TotalEnergies
Can any of the company-specific risk be diversified away by investing in both LIFE + and TotalEnergies 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 LIFE + and TotalEnergies into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between LIFE BANC SPLIT and TotalEnergies SE, you can compare the effects of market volatilities on LIFE + and TotalEnergies 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 LIFE + with a short position of TotalEnergies. Check out your portfolio center. Please also check ongoing floating volatility patterns of LIFE + and TotalEnergies.
Diversification Opportunities for LIFE + and TotalEnergies
-0.38 | Correlation Coefficient |
Very good diversification
The 3 months correlation between LIFE and TotalEnergies is -0.38. Overlapping area represents the amount of risk that can be diversified away by holding LIFE BANC SPLIT and TotalEnergies SE in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on TotalEnergies SE and 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 LIFE BANC SPLIT are associated (or correlated) with TotalEnergies. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of TotalEnergies SE has no effect on the direction of LIFE + i.e., LIFE + and TotalEnergies go up and down completely randomly.
Pair Corralation between LIFE + and TotalEnergies
Assuming the 90 days horizon LIFE BANC SPLIT is expected to under-perform the TotalEnergies. In addition to that, LIFE + is 2.38 times more volatile than TotalEnergies SE. It trades about -0.05 of its total potential returns per unit of risk. TotalEnergies SE is currently generating about 0.14 per unit of volatility. If you would invest 5,550 in TotalEnergies SE on November 28, 2024 and sell it today you would earn a total of 250.00 from holding TotalEnergies SE or generate 4.5% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
LIFE BANC SPLIT vs. TotalEnergies SE
Performance |
| Timeline |
| LIFE BANC SPLIT |
| TotalEnergies SE |
LIFE + and TotalEnergies Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with LIFE + and TotalEnergies
The main advantage of trading using opposite LIFE + and TotalEnergies positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if LIFE + position performs unexpectedly, TotalEnergies 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 TotalEnergies will offset losses from the drop in TotalEnergies' long position.| LIFE + vs. INTERSHOP Communications Aktiengesellschaft | LIFE + vs. Coeur Mining | LIFE + vs. Mobilezone Holding AG | LIFE + vs. Tower One Wireless |
| TotalEnergies vs. SEKISUI CHEMICAL | TotalEnergies vs. SILICON LABORATOR | TotalEnergies vs. MICRONIC MYDATA | TotalEnergies vs. STORAGEVAULT CANADA INC |
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 Bonds Directory module to find actively traded corporate debentures issued by US companies.
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