Correlation Between Invibes Advertising and Air France
Can any of the company-specific risk be diversified away by investing in both Invibes Advertising and Air France 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 Invibes Advertising and Air France into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Invibes Advertising NV and Air France KLM SA, you can compare the effects of market volatilities on Invibes Advertising and Air France 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 Invibes Advertising with a short position of Air France. Check out your portfolio center. Please also check ongoing floating volatility patterns of Invibes Advertising and Air France.
Diversification Opportunities for Invibes Advertising and Air France
0.59 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Invibes and Air is 0.59. Overlapping area represents the amount of risk that can be diversified away by holding Invibes Advertising NV and Air France KLM SA in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Air France KLM and Invibes Advertising 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 Invibes Advertising NV are associated (or correlated) with Air France. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Air France KLM has no effect on the direction of Invibes Advertising i.e., Invibes Advertising and Air France go up and down completely randomly.
Pair Corralation between Invibes Advertising and Air France
Assuming the 90 days trading horizon Invibes Advertising NV is expected to generate 2.67 times more return on investment than Air France. However, Invibes Advertising is 2.67 times more volatile than Air France KLM SA. It trades about 0.0 of its potential returns per unit of risk. Air France KLM SA is currently generating about -0.19 per unit of risk. If you would invest 192.00 in Invibes Advertising NV on October 26, 2024 and sell it today you would lose (7.00) from holding Invibes Advertising NV or give up 3.65% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Invibes Advertising NV vs. Air France KLM SA
Performance |
| Timeline |
| Invibes Advertising |
| Air France KLM |
Invibes Advertising and Air France Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Invibes Advertising and Air France
The main advantage of trading using opposite Invibes Advertising and Air France positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Invibes Advertising position performs unexpectedly, Air France 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 Air France will offset losses from the drop in Air France's long position.| Invibes Advertising vs. Streamwide | Invibes Advertising vs. Claranova SE | Invibes Advertising vs. SA Catana Group | Invibes Advertising vs. Wallix Group SA |
| Air France vs. Diagnostic Medical Systems | Air France vs. Media 6 SA | Air France vs. Les Hotels Bav | Air France vs. Hoteles Bestprice 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 Companies Directory module to evaluate performance of over 100,000 Stocks, Funds, and ETFs against different fundamentals.
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