Correlation Between Gevelot and Groupe Guillin
Can any of the company-specific risk be diversified away by investing in both Gevelot and Groupe Guillin 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 Gevelot and Groupe Guillin into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Gevelot and Groupe Guillin SA, you can compare the effects of market volatilities on Gevelot and Groupe Guillin 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 Gevelot with a short position of Groupe Guillin. Check out your portfolio center. Please also check ongoing floating volatility patterns of Gevelot and Groupe Guillin.
Diversification Opportunities for Gevelot and Groupe Guillin
0.47 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Gevelot and Groupe is 0.47. Overlapping area represents the amount of risk that can be diversified away by holding Gevelot and Groupe Guillin SA in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Groupe Guillin SA and Gevelot 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 Gevelot are associated (or correlated) with Groupe Guillin. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Groupe Guillin SA has no effect on the direction of Gevelot i.e., Gevelot and Groupe Guillin go up and down completely randomly.
Pair Corralation between Gevelot and Groupe Guillin
Assuming the 90 days trading horizon Gevelot is expected to generate 0.38 times more return on investment than Groupe Guillin. However, Gevelot is 2.66 times less risky than Groupe Guillin. It trades about -0.12 of its potential returns per unit of risk. Groupe Guillin SA is currently generating about -0.19 per unit of risk. If you would invest 19,000 in Gevelot on August 29, 2024 and sell it today you would lose (200.00) from holding Gevelot or give up 1.05% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Gevelot vs. Groupe Guillin SA
Performance |
| Timeline |
| Gevelot |
| Groupe Guillin SA |
Gevelot and Groupe Guillin Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Gevelot and Groupe Guillin
The main advantage of trading using opposite Gevelot and Groupe Guillin positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Gevelot position performs unexpectedly, Groupe Guillin 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 Groupe Guillin will offset losses from the drop in Groupe Guillin's long position.| Gevelot vs. Prodways Group SA | Gevelot vs. Claranova SE | Gevelot vs. DBV Technologies SA | Gevelot vs. Manitou BF SA |
| Groupe Guillin vs. Neurones | Groupe Guillin vs. Aubay Socit Anonyme | Groupe Guillin vs. Infotel SA | Groupe Guillin 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 Odds Of Bankruptcy module to get analysis of equity chance of financial distress in the next 2 years.
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