Correlation Between Gascogne and Thermador Groupe
Can any of the company-specific risk be diversified away by investing in both Gascogne and Thermador Groupe 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 Gascogne and Thermador Groupe into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Gascogne SA and Thermador Groupe SA, you can compare the effects of market volatilities on Gascogne and Thermador Groupe 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 Gascogne with a short position of Thermador Groupe. Check out your portfolio center. Please also check ongoing floating volatility patterns of Gascogne and Thermador Groupe.
Diversification Opportunities for Gascogne and Thermador Groupe
0.76 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Gascogne and Thermador is 0.76. Overlapping area represents the amount of risk that can be diversified away by holding Gascogne SA and Thermador Groupe SA in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Thermador Groupe and Gascogne 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 Gascogne SA are associated (or correlated) with Thermador Groupe. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Thermador Groupe has no effect on the direction of Gascogne i.e., Gascogne and Thermador Groupe go up and down completely randomly.
Pair Corralation between Gascogne and Thermador Groupe
Assuming the 90 days trading horizon Gascogne SA is expected to under-perform the Thermador Groupe. In addition to that, Gascogne is 1.1 times more volatile than Thermador Groupe SA. It trades about -0.03 of its total potential returns per unit of risk. Thermador Groupe SA is currently generating about 0.18 per unit of volatility. If you would invest 6,830 in Thermador Groupe SA on October 1, 2024 and sell it today you would earn a total of 350.00 from holding Thermador Groupe SA or generate 5.12% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Gascogne SA vs. Thermador Groupe SA
Performance |
| Timeline |
| Gascogne SA |
| Thermador Groupe |
Gascogne and Thermador Groupe Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Gascogne and Thermador Groupe
The main advantage of trading using opposite Gascogne and Thermador Groupe positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Gascogne position performs unexpectedly, Thermador Groupe 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 Thermador Groupe will offset losses from the drop in Thermador Groupe's long position.| Gascogne vs. SA Catana Group | Gascogne vs. Poujoulat SA | Gascogne vs. Piscines Desjoyaux SA | Gascogne vs. Reworld Media |
| Thermador Groupe vs. Stef SA | Thermador Groupe vs. Robertet SA | Thermador Groupe vs. Grard Perrier Industrie | Thermador Groupe vs. Aubay Socit Anonyme |
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 Insider Screener module to find insiders across different sectors to evaluate their impact on performance.
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