Correlation Between Credit Agricole and Sidetrade
Can any of the company-specific risk be diversified away by investing in both Credit Agricole and Sidetrade 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 Credit Agricole and Sidetrade into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Credit Agricole SA and Sidetrade, you can compare the effects of market volatilities on Credit Agricole and Sidetrade 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 Credit Agricole with a short position of Sidetrade. Check out your portfolio center. Please also check ongoing floating volatility patterns of Credit Agricole and Sidetrade.
Diversification Opportunities for Credit Agricole and Sidetrade
-0.49 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Credit and Sidetrade is -0.49. Overlapping area represents the amount of risk that can be diversified away by holding Credit Agricole SA and Sidetrade in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Sidetrade and Credit Agricole 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 Credit Agricole SA are associated (or correlated) with Sidetrade. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Sidetrade has no effect on the direction of Credit Agricole i.e., Credit Agricole and Sidetrade go up and down completely randomly.
Pair Corralation between Credit Agricole and Sidetrade
Assuming the 90 days trading horizon Credit Agricole SA is expected to under-perform the Sidetrade. But the stock apears to be less risky and, when comparing its historical volatility, Credit Agricole SA is 1.1 times less risky than Sidetrade. The stock trades about -0.3 of its potential returns per unit of risk. The Sidetrade is currently generating about 0.05 of returns per unit of risk over similar time horizon. If you would invest 22,400 in Sidetrade on August 28, 2024 and sell it today you would earn a total of 300.00 from holding Sidetrade or generate 1.34% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Credit Agricole SA vs. Sidetrade
Performance |
| Timeline |
| Credit Agricole SA |
| Sidetrade |
Credit Agricole and Sidetrade Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Credit Agricole and Sidetrade
The main advantage of trading using opposite Credit Agricole and Sidetrade positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Credit Agricole position performs unexpectedly, Sidetrade 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 Sidetrade will offset losses from the drop in Sidetrade's long position.| Credit Agricole vs. Societe Generale SA | Credit Agricole vs. BNP Paribas SA | Credit Agricole vs. AXA SA | Credit Agricole vs. Orange SA |
| Sidetrade vs. Sartorius Stedim Biotech | Sidetrade vs. Lectra SA | Sidetrade vs. Teleperformance SE | Sidetrade vs. Trigano 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 Bond Analysis module to evaluate and analyze corporate bonds as a potential investment for your portfolios..
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