Correlation Between Air Liquide and Bonduelle SCA
Can any of the company-specific risk be diversified away by investing in both Air Liquide and Bonduelle SCA 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 Air Liquide and Bonduelle SCA into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Air Liquide SA and Bonduelle SCA, you can compare the effects of market volatilities on Air Liquide and Bonduelle SCA 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 Air Liquide with a short position of Bonduelle SCA. Check out your portfolio center. Please also check ongoing floating volatility patterns of Air Liquide and Bonduelle SCA.
Diversification Opportunities for Air Liquide and Bonduelle SCA
0.66 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Air and Bonduelle is 0.66. Overlapping area represents the amount of risk that can be diversified away by holding Air Liquide SA and Bonduelle SCA in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Bonduelle SCA and Air Liquide 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 Air Liquide SA are associated (or correlated) with Bonduelle SCA. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Bonduelle SCA has no effect on the direction of Air Liquide i.e., Air Liquide and Bonduelle SCA go up and down completely randomly.
Pair Corralation between Air Liquide and Bonduelle SCA
Assuming the 90 days horizon Air Liquide SA is expected to under-perform the Bonduelle SCA. But the stock apears to be less risky and, when comparing its historical volatility, Air Liquide SA is 1.5 times less risky than Bonduelle SCA. The stock trades about -0.1 of its potential returns per unit of risk. The Bonduelle SCA is currently generating about -0.03 of returns per unit of risk over similar time horizon. If you would invest 672.00 in Bonduelle SCA on August 29, 2024 and sell it today you would lose (28.00) from holding Bonduelle SCA or give up 4.17% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Air Liquide SA vs. Bonduelle SCA
Performance |
| Timeline |
| Air Liquide SA |
| Bonduelle SCA |
Air Liquide and Bonduelle SCA Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Air Liquide and Bonduelle SCA
The main advantage of trading using opposite Air Liquide and Bonduelle SCA positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Air Liquide position performs unexpectedly, Bonduelle SCA 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 Bonduelle SCA will offset losses from the drop in Bonduelle SCA's long position.| Air Liquide vs. Sanofi SA | Air Liquide vs. LOreal SA | Air Liquide vs. Vinci SA | Air Liquide vs. Schneider Electric SE |
| Bonduelle SCA vs. Socit BIC SA | Bonduelle SCA vs. Bnteau SA | Bonduelle SCA vs. Casino Guichard Perrachon | Bonduelle SCA vs. SEB 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 Bonds Directory module to find actively traded corporate debentures issued by US companies.
Other Complementary Tools
| Idea Analyzer Analyze all characteristics, volatility and risk-adjusted return of Macroaxis ideas | |
| Options Analysis Analyze and evaluate options and option chains as a potential hedge for your portfolios | |
| Piotroski F Score Get Piotroski F Score based on the binary analysis strategy of nine different fundamentals | |
| Price Exposure Probability Analyze equity upside and downside potential for a given time horizon across multiple markets | |
| Theme Ratings Determine theme ratings based on digital equity recommendations. Macroaxis theme ratings are based on combination of fundamental analysis and risk-adjusted market performance |