Correlation Between Gaztransport Technigaz and SENECA FOODS
Can any of the company-specific risk be diversified away by investing in both Gaztransport Technigaz and SENECA FOODS 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 Gaztransport Technigaz and SENECA FOODS into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Gaztransport Technigaz SA and SENECA FOODS A, you can compare the effects of market volatilities on Gaztransport Technigaz and SENECA FOODS 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 Gaztransport Technigaz with a short position of SENECA FOODS. Check out your portfolio center. Please also check ongoing floating volatility patterns of Gaztransport Technigaz and SENECA FOODS.
Diversification Opportunities for Gaztransport Technigaz and SENECA FOODS
0.71 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Gaztransport and SENECA is 0.71. Overlapping area represents the amount of risk that can be diversified away by holding Gaztransport Technigaz SA and SENECA FOODS A in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on SENECA FOODS A and Gaztransport Technigaz 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 Gaztransport Technigaz SA are associated (or correlated) with SENECA FOODS. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of SENECA FOODS A has no effect on the direction of Gaztransport Technigaz i.e., Gaztransport Technigaz and SENECA FOODS go up and down completely randomly.
Pair Corralation between Gaztransport Technigaz and SENECA FOODS
Assuming the 90 days horizon Gaztransport Technigaz SA is expected to under-perform the SENECA FOODS. But the stock apears to be less risky and, when comparing its historical volatility, Gaztransport Technigaz SA is 1.06 times less risky than SENECA FOODS. The stock trades about -0.14 of its potential returns per unit of risk. The SENECA FOODS A is currently generating about 0.4 of returns per unit of risk over similar time horizon. If you would invest 5,800 in SENECA FOODS A on September 12, 2024 and sell it today you would earn a total of 950.00 from holding SENECA FOODS A or generate 16.38% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 95.65% |
| Values | Daily Returns |
Gaztransport Technigaz SA vs. SENECA FOODS A
Performance |
| Timeline |
| Gaztransport Technigaz |
| SENECA FOODS A |
Gaztransport Technigaz and SENECA FOODS Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Gaztransport Technigaz and SENECA FOODS
The main advantage of trading using opposite Gaztransport Technigaz and SENECA FOODS positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Gaztransport Technigaz position performs unexpectedly, SENECA FOODS 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 SENECA FOODS will offset losses from the drop in SENECA FOODS's long position.| Gaztransport Technigaz vs. Tenaris SA | Gaztransport Technigaz vs. NOV Inc | Gaztransport Technigaz vs. Superior Plus Corp | Gaztransport Technigaz vs. SIVERS SEMICONDUCTORS AB |
| SENECA FOODS vs. Xenia Hotels Resorts | SENECA FOODS vs. COSTCO WHOLESALE CDR | SENECA FOODS vs. Hyatt Hotels | SENECA FOODS vs. Ross Stores |
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 Aroon Oscillator module to analyze current equity momentum using Aroon Oscillator and other momentum ratios.
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