Correlation Between Wallix Group and Lectra SA
Can any of the company-specific risk be diversified away by investing in both Wallix Group and Lectra 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 Wallix Group and Lectra SA into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Wallix Group SA and Lectra SA, you can compare the effects of market volatilities on Wallix Group and Lectra 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 Wallix Group with a short position of Lectra SA. Check out your portfolio center. Please also check ongoing floating volatility patterns of Wallix Group and Lectra SA.
Diversification Opportunities for Wallix Group and Lectra SA
0.49 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Wallix and Lectra is 0.49. Overlapping area represents the amount of risk that can be diversified away by holding Wallix Group SA and Lectra SA in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Lectra SA and Wallix Group 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 Wallix Group SA are associated (or correlated) with Lectra SA. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Lectra SA has no effect on the direction of Wallix Group i.e., Wallix Group and Lectra SA go up and down completely randomly.
Pair Corralation between Wallix Group and Lectra SA
Assuming the 90 days trading horizon Wallix Group SA is expected to generate 0.82 times more return on investment than Lectra SA. However, Wallix Group SA is 1.21 times less risky than Lectra SA. It trades about 0.32 of its potential returns per unit of risk. Lectra SA is currently generating about 0.08 per unit of risk. If you would invest 990.00 in Wallix Group SA on November 28, 2024 and sell it today you would earn a total of 184.00 from holding Wallix Group SA or generate 18.59% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Wallix Group SA vs. Lectra SA
Performance |
| Timeline |
| Wallix Group SA |
| Lectra SA |
Wallix Group and Lectra SA Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Wallix Group and Lectra SA
The main advantage of trading using opposite Wallix Group and Lectra SA positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Wallix Group position performs unexpectedly, Lectra 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 Lectra SA will offset losses from the drop in Lectra SA's long position.| Wallix Group vs. Esker SA | Wallix Group vs. Kalray SA | Wallix Group vs. Claranova SE | Wallix Group vs. Lumibird SA |
| Lectra SA vs. Linedata Services SA | Lectra SA vs. Interparfums SA | Lectra SA vs. Esker SA | Lectra SA vs. Neurones |
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 Funds Screener module to find actively-traded funds from around the world traded on over 30 global exchanges.
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