Correlation Between Groupe Guillin and Esker SA
Can any of the company-specific risk be diversified away by investing in both Groupe Guillin and Esker 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 Groupe Guillin and Esker SA into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Groupe Guillin SA and Esker SA, you can compare the effects of market volatilities on Groupe Guillin and Esker 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 Groupe Guillin with a short position of Esker SA. Check out your portfolio center. Please also check ongoing floating volatility patterns of Groupe Guillin and Esker SA.
Diversification Opportunities for Groupe Guillin and Esker SA
-0.33 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Groupe and Esker is -0.33. Overlapping area represents the amount of risk that can be diversified away by holding Groupe Guillin SA and Esker SA in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Esker SA and Groupe Guillin 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 Groupe Guillin SA are associated (or correlated) with Esker SA. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Esker SA has no effect on the direction of Groupe Guillin i.e., Groupe Guillin and Esker SA go up and down completely randomly.
Pair Corralation between Groupe Guillin and Esker SA
Assuming the 90 days trading horizon Groupe Guillin is expected to generate 7.3 times less return on investment than Esker SA. But when comparing it to its historical volatility, Groupe Guillin SA is 1.11 times less risky than Esker SA. It trades about 0.02 of its potential returns per unit of risk. Esker SA is currently generating about 0.1 of returns per unit of risk over similar time horizon. If you would invest 14,438 in Esker SA on September 12, 2024 and sell it today you would earn a total of 11,562 from holding Esker SA or generate 80.08% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Groupe Guillin SA vs. Esker SA
Performance |
| Timeline |
| Groupe Guillin SA |
| Esker SA |
Groupe Guillin and Esker SA Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Groupe Guillin and Esker SA
The main advantage of trading using opposite Groupe Guillin and Esker SA positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Groupe Guillin position performs unexpectedly, Esker 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 Esker SA will offset losses from the drop in Esker SA's long position.| Groupe Guillin vs. Robertet SA | Groupe Guillin vs. Thermador Groupe SA | Groupe Guillin vs. Grard Perrier Industrie |
| Esker SA vs. Groupe Guillin SA | Esker SA vs. Stef SA | Esker SA vs. SA Catana Group | Esker SA vs. Jacquet Metal Service |
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 Correlation Analysis module to reduce portfolio risk simply by holding instruments which are not perfectly correlated.
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