Correlation Between Fill Up and Invibes Advertising
Can any of the company-specific risk be diversified away by investing in both Fill Up and Invibes Advertising 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 Fill Up and Invibes Advertising into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Fill Up Media and Invibes Advertising NV, you can compare the effects of market volatilities on Fill Up and Invibes Advertising 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 Fill Up with a short position of Invibes Advertising. Check out your portfolio center. Please also check ongoing floating volatility patterns of Fill Up and Invibes Advertising.
Diversification Opportunities for Fill Up and Invibes Advertising
0.85 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between Fill and Invibes is 0.85. Overlapping area represents the amount of risk that can be diversified away by holding Fill Up Media and Invibes Advertising NV in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Invibes Advertising and Fill Up 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 Fill Up Media are associated (or correlated) with Invibes Advertising. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Invibes Advertising has no effect on the direction of Fill Up i.e., Fill Up and Invibes Advertising go up and down completely randomly.
Pair Corralation between Fill Up and Invibes Advertising
Assuming the 90 days trading horizon Fill Up Media is expected to generate 0.76 times more return on investment than Invibes Advertising. However, Fill Up Media is 1.32 times less risky than Invibes Advertising. It trades about -0.01 of its potential returns per unit of risk. Invibes Advertising NV is currently generating about -0.26 per unit of risk. If you would invest 600.00 in Fill Up Media on August 30, 2024 and sell it today you would lose (10.00) from holding Fill Up Media or give up 1.67% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Fill Up Media vs. Invibes Advertising NV
Performance |
| Timeline |
| Fill Up Media |
| Invibes Advertising |
Fill Up and Invibes Advertising Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Fill Up and Invibes Advertising
The main advantage of trading using opposite Fill Up and Invibes Advertising positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Fill Up position performs unexpectedly, Invibes Advertising 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 Invibes Advertising will offset losses from the drop in Invibes Advertising's long position.| Fill Up vs. Grolleau SAS | Fill Up vs. Hydrogene De France | Fill Up vs. Trigano SA | Fill Up vs. Manitou BF SA |
| Invibes Advertising vs. Grolleau SAS | Invibes Advertising vs. Hydrogene De France | Invibes Advertising vs. Trigano SA | Invibes Advertising vs. Manitou BF 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 Price Transformation module to use Price Transformation models to analyze the depth of different equity instruments across global markets.
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