Correlation Between Artea SA and Bourse Direct
Can any of the company-specific risk be diversified away by investing in both Artea SA and Bourse Direct 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 Artea SA and Bourse Direct into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Artea SA and Bourse Direct SA, you can compare the effects of market volatilities on Artea SA and Bourse Direct 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 Artea SA with a short position of Bourse Direct. Check out your portfolio center. Please also check ongoing floating volatility patterns of Artea SA and Bourse Direct.
Diversification Opportunities for Artea SA and Bourse Direct
0.02 | Correlation Coefficient |
Significant diversification
The 3 months correlation between Artea and Bourse is 0.02. Overlapping area represents the amount of risk that can be diversified away by holding Artea SA and Bourse Direct SA in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Bourse Direct SA and Artea 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 Artea SA are associated (or correlated) with Bourse Direct. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Bourse Direct SA has no effect on the direction of Artea SA i.e., Artea SA and Bourse Direct go up and down completely randomly.
Pair Corralation between Artea SA and Bourse Direct
Assuming the 90 days trading horizon Artea SA is expected to under-perform the Bourse Direct. But the stock apears to be less risky and, when comparing its historical volatility, Artea SA is 1.02 times less risky than Bourse Direct. The stock trades about -0.29 of its potential returns per unit of risk. The Bourse Direct SA is currently generating about -0.03 of returns per unit of risk over similar time horizon. If you would invest 446.00 in Bourse Direct SA on September 1, 2024 and sell it today you would lose (8.00) from holding Bourse Direct SA or give up 1.79% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 95.65% |
| Values | Daily Returns |
Artea SA vs. Bourse Direct SA
Performance |
| Timeline |
| Artea SA |
| Bourse Direct SA |
Artea SA and Bourse Direct Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Artea SA and Bourse Direct
The main advantage of trading using opposite Artea SA and Bourse Direct positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Artea SA position performs unexpectedly, Bourse Direct 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 Bourse Direct will offset losses from the drop in Bourse Direct's long position.| Artea SA vs. Bourse Direct SA | Artea SA vs. CBO Territoria SA | Artea SA vs. Altareit | Artea SA vs. Courtois SA |
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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 FinTech Suite module to use AI to screen and filter profitable investment opportunities.
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