Correlation Between Affluent Medical and Gaztransport Technigaz
Can any of the company-specific risk be diversified away by investing in both Affluent Medical and Gaztransport Technigaz 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 Gaztransport Technigaz 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 Gaztransport Technigaz SAS, you can compare the effects of market volatilities on Affluent Medical and Gaztransport Technigaz 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 Gaztransport Technigaz. Check out your portfolio center. Please also check ongoing floating volatility patterns of Affluent Medical and Gaztransport Technigaz.
Diversification Opportunities for Affluent Medical and Gaztransport Technigaz
-0.29 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Affluent and Gaztransport is -0.29. Overlapping area represents the amount of risk that can be diversified away by holding Affluent Medical SAS and Gaztransport Technigaz SAS in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Gaztransport Technigaz 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 Gaztransport Technigaz. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Gaztransport Technigaz has no effect on the direction of Affluent Medical i.e., Affluent Medical and Gaztransport Technigaz go up and down completely randomly.
Pair Corralation between Affluent Medical and Gaztransport Technigaz
Assuming the 90 days trading horizon Affluent Medical SAS is expected to under-perform the Gaztransport Technigaz. In addition to that, Affluent Medical is 2.57 times more volatile than Gaztransport Technigaz SAS. It trades about -0.02 of its total potential returns per unit of risk. Gaztransport Technigaz SAS is currently generating about 0.28 per unit of volatility. If you would invest 13,140 in Gaztransport Technigaz SAS on August 24, 2024 and sell it today you would earn a total of 980.00 from holding Gaztransport Technigaz SAS or generate 7.46% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Affluent Medical SAS vs. Gaztransport Technigaz SAS
Performance |
| Timeline |
| Affluent Medical SAS |
| Gaztransport Technigaz |
Affluent Medical and Gaztransport Technigaz Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Affluent Medical and Gaztransport Technigaz
The main advantage of trading using opposite Affluent Medical and Gaztransport Technigaz positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Affluent Medical position performs unexpectedly, Gaztransport Technigaz 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 Gaztransport Technigaz will offset losses from the drop in Gaztransport Technigaz's long position.| Affluent Medical vs. Aramis SAS | Affluent Medical vs. Spartoo SAS | Affluent Medical vs. Hydrogene De France | Affluent Medical vs. Omer Decugis Cie |
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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 Portfolio File Import module to quickly import all of your third-party portfolios from your local drive in csv format.
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