Correlation Between Affluent Medical and Avenir Telecom
Can any of the company-specific risk be diversified away by investing in both Affluent Medical and Avenir Telecom 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 Affluent Medical and Avenir Telecom into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Affluent Medical SAS and Avenir Telecom SA, you can compare the effects of market volatilities on Affluent Medical and Avenir Telecom 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 Affluent Medical with a short position of Avenir Telecom. Check out your portfolio center. Please also check ongoing floating volatility patterns of Affluent Medical and Avenir Telecom.
Diversification Opportunities for Affluent Medical and Avenir Telecom
0.63 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Affluent and Avenir is 0.63. Overlapping area represents the amount of risk that can be diversified away by holding Affluent Medical SAS and Avenir Telecom SA in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Avenir Telecom SA and Affluent Medical 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 Affluent Medical SAS are associated (or correlated) with Avenir Telecom. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Avenir Telecom SA has no effect on the direction of Affluent Medical i.e., Affluent Medical and Avenir Telecom go up and down completely randomly.
Pair Corralation between Affluent Medical and Avenir Telecom
Assuming the 90 days trading horizon Affluent Medical is expected to generate 1.3 times less return on investment than Avenir Telecom. But when comparing it to its historical volatility, Affluent Medical SAS is 1.42 times less risky than Avenir Telecom. It trades about 0.02 of its potential returns per unit of risk. Avenir Telecom SA is currently generating about 0.01 of returns per unit of risk over similar time horizon. If you would invest 13.00 in Avenir Telecom SA on September 3, 2024 and sell it today you would lose (5.83) from holding Avenir Telecom SA or give up 44.85% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Affluent Medical SAS vs. Avenir Telecom SA
Performance |
| Timeline |
| Affluent Medical SAS |
| Avenir Telecom SA |
Affluent Medical and Avenir Telecom Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Affluent Medical and Avenir Telecom
The main advantage of trading using opposite Affluent Medical and Avenir Telecom positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Affluent Medical position performs unexpectedly, Avenir Telecom 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 Avenir Telecom will offset losses from the drop in Avenir Telecom's long position.| Affluent Medical vs. Biosynex | Affluent Medical vs. Novacyt | Affluent Medical vs. Biophytis SA | Affluent Medical vs. Intrasense |
| Avenir Telecom vs. Acheter Louer | Avenir Telecom vs. Europlasma SA | Avenir Telecom vs. DBT SA | Avenir Telecom vs. Solocal Group 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 Fundamental Analysis module to view fundamental data based on most recent published financial statements.
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