Correlation Between FreelanceCom and Thermador Groupe
Can any of the company-specific risk be diversified away by investing in both FreelanceCom 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 FreelanceCom and Thermador Groupe into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between FreelanceCom and Thermador Groupe SA, you can compare the effects of market volatilities on FreelanceCom 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 FreelanceCom with a short position of Thermador Groupe. Check out your portfolio center. Please also check ongoing floating volatility patterns of FreelanceCom and Thermador Groupe.
Diversification Opportunities for FreelanceCom and Thermador Groupe
-0.04 | Correlation Coefficient |
Good diversification
The 3 months correlation between FreelanceCom and Thermador is -0.04. Overlapping area represents the amount of risk that can be diversified away by holding FreelanceCom and Thermador Groupe SA in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Thermador Groupe and FreelanceCom 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 FreelanceCom 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 FreelanceCom i.e., FreelanceCom and Thermador Groupe go up and down completely randomly.
Pair Corralation between FreelanceCom and Thermador Groupe
Assuming the 90 days trading horizon FreelanceCom is expected to generate 1.6 times more return on investment than Thermador Groupe. However, FreelanceCom is 1.6 times more volatile than Thermador Groupe SA. It trades about 0.07 of its potential returns per unit of risk. Thermador Groupe SA is currently generating about 0.05 per unit of risk. If you would invest 270.00 in FreelanceCom on September 22, 2024 and sell it today you would earn a total of 8.00 from holding FreelanceCom or generate 2.96% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
FreelanceCom vs. Thermador Groupe SA
Performance |
| Timeline |
| FreelanceCom |
| Thermador Groupe |
FreelanceCom and Thermador Groupe Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with FreelanceCom and Thermador Groupe
The main advantage of trading using opposite FreelanceCom and Thermador Groupe positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if FreelanceCom 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.| FreelanceCom vs. Thermador Groupe SA | FreelanceCom vs. Samse SA | FreelanceCom vs. Rubis SCA | FreelanceCom vs. Trigano SA |
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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 Financial Widgets module to easily integrated Macroaxis content with over 30 different plug-and-play financial widgets.
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