Correlation Between Grolleau SAS and Publicis Groupe
Can any of the company-specific risk be diversified away by investing in both Grolleau SAS and Publicis 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 Grolleau SAS and Publicis Groupe into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Grolleau SAS and Publicis Groupe SA, you can compare the effects of market volatilities on Grolleau SAS and Publicis 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 Grolleau SAS with a short position of Publicis Groupe. Check out your portfolio center. Please also check ongoing floating volatility patterns of Grolleau SAS and Publicis Groupe.
Diversification Opportunities for Grolleau SAS and Publicis Groupe
-0.4 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Grolleau and Publicis is -0.4. Overlapping area represents the amount of risk that can be diversified away by holding Grolleau SAS and Publicis Groupe SA in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Publicis Groupe SA and Grolleau SAS 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 Grolleau SAS are associated (or correlated) with Publicis Groupe. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Publicis Groupe SA has no effect on the direction of Grolleau SAS i.e., Grolleau SAS and Publicis Groupe go up and down completely randomly.
Pair Corralation between Grolleau SAS and Publicis Groupe
Assuming the 90 days trading horizon Grolleau SAS is expected to under-perform the Publicis Groupe. In addition to that, Grolleau SAS is 2.37 times more volatile than Publicis Groupe SA. It trades about -0.03 of its total potential returns per unit of risk. Publicis Groupe SA is currently generating about 0.09 per unit of volatility. If you would invest 5,675 in Publicis Groupe SA on August 30, 2024 and sell it today you would earn a total of 4,475 from holding Publicis Groupe SA or generate 78.85% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Grolleau SAS vs. Publicis Groupe SA
Performance |
| Timeline |
| Grolleau SAS |
| Publicis Groupe SA |
Grolleau SAS and Publicis Groupe Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Grolleau SAS and Publicis Groupe
The main advantage of trading using opposite Grolleau SAS and Publicis Groupe positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Grolleau SAS position performs unexpectedly, Publicis 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 Publicis Groupe will offset losses from the drop in Publicis Groupe's long position.| Grolleau SAS vs. Berkem Group SA | Grolleau SAS vs. Waga Energy SA | Grolleau SAS vs. Entech SE SAS | Grolleau SAS vs. Orapi SA |
| Publicis Groupe vs. Grolleau SAS | Publicis Groupe vs. Hydrogene De France | Publicis Groupe vs. Trigano SA | Publicis Groupe 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 Alpha Finder module to use alpha and beta coefficients to find investment opportunities after accounting for the risk.
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