Correlation Between Airbus Group and Centrale DAchat
Can any of the company-specific risk be diversified away by investing in both Airbus Group and Centrale DAchat 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 Airbus Group and Centrale DAchat into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Airbus Group SE and Centrale dAchat Franaise, you can compare the effects of market volatilities on Airbus Group and Centrale DAchat 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 Airbus Group with a short position of Centrale DAchat. Check out your portfolio center. Please also check ongoing floating volatility patterns of Airbus Group and Centrale DAchat.
Diversification Opportunities for Airbus Group and Centrale DAchat
-0.65 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between Airbus and Centrale is -0.65. Overlapping area represents the amount of risk that can be diversified away by holding Airbus Group SE and Centrale dAchat Franaise in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Centrale dAchat Franaise and Airbus Group 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 Airbus Group SE are associated (or correlated) with Centrale DAchat. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Centrale dAchat Franaise has no effect on the direction of Airbus Group i.e., Airbus Group and Centrale DAchat go up and down completely randomly.
Pair Corralation between Airbus Group and Centrale DAchat
Assuming the 90 days trading horizon Airbus Group SE is expected to generate 0.77 times more return on investment than Centrale DAchat. However, Airbus Group SE is 1.3 times less risky than Centrale DAchat. It trades about 0.2 of its potential returns per unit of risk. Centrale dAchat Franaise is currently generating about 0.12 per unit of risk. If you would invest 16,014 in Airbus Group SE on November 3, 2024 and sell it today you would earn a total of 698.00 from holding Airbus Group SE or generate 4.36% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Airbus Group SE vs. Centrale dAchat Franaise
Performance |
| Timeline |
| Airbus Group SE |
| Centrale dAchat Franaise |
Airbus Group and Centrale DAchat Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Airbus Group and Centrale DAchat
The main advantage of trading using opposite Airbus Group and Centrale DAchat positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Airbus Group position performs unexpectedly, Centrale DAchat 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 Centrale DAchat will offset losses from the drop in Centrale DAchat's long position.| Airbus Group vs. Safran SA | Airbus Group vs. LVMH Mot Hennessy | Airbus Group vs. BNP Paribas SA | Airbus Group vs. Air France KLM SA |
| Centrale DAchat vs. Vente Unique | Centrale DAchat vs. Groupe Sfpi | Centrale DAchat vs. Cegedim SA | Centrale DAchat vs. SA Catana Group |
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 Sectors module to list of equity sectors categorizing publicly traded companies based on their primary business activities.
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