Correlation Between Les Hotels and Bernard Loisea
Can any of the company-specific risk be diversified away by investing in both Les Hotels and Bernard Loisea 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 Les Hotels and Bernard Loisea into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Les Hotels Bav and Bernard Loisea, you can compare the effects of market volatilities on Les Hotels and Bernard Loisea 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 Les Hotels with a short position of Bernard Loisea. Check out your portfolio center. Please also check ongoing floating volatility patterns of Les Hotels and Bernard Loisea.
Diversification Opportunities for Les Hotels and Bernard Loisea
-0.27 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Les and Bernard is -0.27. Overlapping area represents the amount of risk that can be diversified away by holding Les Hotels Bav and Bernard Loisea in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Bernard Loisea and Les Hotels 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 Les Hotels Bav are associated (or correlated) with Bernard Loisea. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Bernard Loisea has no effect on the direction of Les Hotels i.e., Les Hotels and Bernard Loisea go up and down completely randomly.
Pair Corralation between Les Hotels and Bernard Loisea
Assuming the 90 days trading horizon Les Hotels Bav is expected to generate 0.88 times more return on investment than Bernard Loisea. However, Les Hotels Bav is 1.14 times less risky than Bernard Loisea. It trades about 0.13 of its potential returns per unit of risk. Bernard Loisea is currently generating about -0.06 per unit of risk. If you would invest 7,350 in Les Hotels Bav on November 28, 2024 and sell it today you would earn a total of 400.00 from holding Les Hotels Bav or generate 5.44% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Les Hotels Bav vs. Bernard Loisea
Performance |
| Timeline |
| Les Hotels Bav |
| Bernard Loisea |
Les Hotels and Bernard Loisea Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Les Hotels and Bernard Loisea
The main advantage of trading using opposite Les Hotels and Bernard Loisea positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Les Hotels position performs unexpectedly, Bernard Loisea 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 Bernard Loisea will offset losses from the drop in Bernard Loisea's long position.| Les Hotels vs. Les Htels de | Les Hotels vs. Moulinvest | Les Hotels vs. Bernard Loisea | Les Hotels vs. Groupimo SA |
| Bernard Loisea vs. Les Htels de | Bernard Loisea vs. Entreparticuli | Bernard Loisea vs. Les Hotels Bav | Bernard Loisea vs. GEA Grenobl Elect |
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 My Watchlist Analysis module to analyze my current watchlist and to refresh optimization strategy. Macroaxis watchlist is based on self-learning algorithm to remember stocks you like.
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