Correlation Between Allegroeu and IMC SA
Can any of the company-specific risk be diversified away by investing in both Allegroeu and IMC SA 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 Allegroeu and IMC SA into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Allegroeu SA and IMC SA, you can compare the effects of market volatilities on Allegroeu and IMC SA 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 Allegroeu with a short position of IMC SA. Check out your portfolio center. Please also check ongoing floating volatility patterns of Allegroeu and IMC SA.
Diversification Opportunities for Allegroeu and IMC SA
Very good diversification
The 3 months correlation between Allegroeu and IMC is -0.38. Overlapping area represents the amount of risk that can be diversified away by holding Allegroeu SA and IMC SA in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on IMC SA and Allegroeu 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 Allegroeu SA are associated (or correlated) with IMC SA. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of IMC SA has no effect on the direction of Allegroeu i.e., Allegroeu and IMC SA go up and down completely randomly.
Pair Corralation between Allegroeu and IMC SA
Assuming the 90 days trading horizon Allegroeu SA is expected to generate 0.84 times more return on investment than IMC SA. However, Allegroeu SA is 1.18 times less risky than IMC SA. It trades about 0.02 of its potential returns per unit of risk. IMC SA is currently generating about 0.0 per unit of risk. If you would invest 2,504 in Allegroeu SA on September 2, 2024 and sell it today you would earn a total of 373.00 from holding Allegroeu SA or generate 14.9% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Allegroeu SA vs. IMC SA
Performance |
| Timeline |
| Allegroeu SA |
| IMC SA |
Allegroeu and IMC SA Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Allegroeu and IMC SA
The main advantage of trading using opposite Allegroeu and IMC SA positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Allegroeu position performs unexpectedly, IMC SA 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 IMC SA will offset losses from the drop in IMC SA's long position.| Allegroeu vs. Intersport Polska SA | Allegroeu vs. SOFTWARE MANSION SPOLKA | Allegroeu vs. UniCredit SpA | Allegroeu vs. Alior Bank SA |
| IMC SA vs. Banco Santander SA | IMC SA vs. UniCredit SpA | IMC SA vs. CEZ as | IMC SA vs. Polski Koncern Naftowy |
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 Money Flow Index module to determine momentum by analyzing Money Flow Index and other technical indicators.
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