Correlation Between Herige SA and Exacompta Clairefontaine
Can any of the company-specific risk be diversified away by investing in both Herige SA and Exacompta Clairefontaine 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 Herige SA and Exacompta Clairefontaine into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Herige SA and Exacompta Clairefontaine, you can compare the effects of market volatilities on Herige SA and Exacompta Clairefontaine 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 Herige SA with a short position of Exacompta Clairefontaine. Check out your portfolio center. Please also check ongoing floating volatility patterns of Herige SA and Exacompta Clairefontaine.
Diversification Opportunities for Herige SA and Exacompta Clairefontaine
-0.58 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between Herige and Exacompta is -0.58. Overlapping area represents the amount of risk that can be diversified away by holding Herige SA and Exacompta Clairefontaine in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Exacompta Clairefontaine and Herige SA 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 Herige SA are associated (or correlated) with Exacompta Clairefontaine. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Exacompta Clairefontaine has no effect on the direction of Herige SA i.e., Herige SA and Exacompta Clairefontaine go up and down completely randomly.
Pair Corralation between Herige SA and Exacompta Clairefontaine
Assuming the 90 days trading horizon Herige SA is expected to under-perform the Exacompta Clairefontaine. In addition to that, Herige SA is 1.15 times more volatile than Exacompta Clairefontaine. It trades about -0.06 of its total potential returns per unit of risk. Exacompta Clairefontaine is currently generating about 0.08 per unit of volatility. If you would invest 13,800 in Exacompta Clairefontaine on September 12, 2024 and sell it today you would earn a total of 1,100 from holding Exacompta Clairefontaine or generate 7.97% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 96.88% |
| Values | Daily Returns |
Herige SA vs. Exacompta Clairefontaine
Performance |
| Timeline |
| Herige SA |
| Exacompta Clairefontaine |
Herige SA and Exacompta Clairefontaine Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Herige SA and Exacompta Clairefontaine
The main advantage of trading using opposite Herige SA and Exacompta Clairefontaine positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Herige SA position performs unexpectedly, Exacompta Clairefontaine 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 Exacompta Clairefontaine will offset losses from the drop in Exacompta Clairefontaine's long position.| Herige SA vs. Jacques Bogart SA | Herige SA vs. Passat Socit Anonyme | Herige SA vs. Stef SA | Herige SA vs. Haulotte Group SA |
| Exacompta Clairefontaine vs. Signaux Girod | Exacompta Clairefontaine vs. Passat Socit Anonyme | Exacompta Clairefontaine vs. Herige SA | Exacompta Clairefontaine vs. Groupe Partouche 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 Correlation Analysis module to reduce portfolio risk simply by holding instruments which are not perfectly correlated.
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