Correlation Between ATEME SA and Lhyfe SA
Can any of the company-specific risk be diversified away by investing in both ATEME SA and Lhyfe 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 ATEME SA and Lhyfe SA into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between ATEME SA and Lhyfe SA, you can compare the effects of market volatilities on ATEME SA and Lhyfe 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 ATEME SA with a short position of Lhyfe SA. Check out your portfolio center. Please also check ongoing floating volatility patterns of ATEME SA and Lhyfe SA.
Diversification Opportunities for ATEME SA and Lhyfe SA
Good diversification
The 3 months correlation between ATEME and Lhyfe is -0.17. Overlapping area represents the amount of risk that can be diversified away by holding ATEME SA and Lhyfe SA in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Lhyfe SA and ATEME 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 ATEME SA are associated (or correlated) with Lhyfe SA. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Lhyfe SA has no effect on the direction of ATEME SA i.e., ATEME SA and Lhyfe SA go up and down completely randomly.
Pair Corralation between ATEME SA and Lhyfe SA
Assuming the 90 days trading horizon ATEME SA is expected to generate 1.27 times more return on investment than Lhyfe SA. However, ATEME SA is 1.27 times more volatile than Lhyfe SA. It trades about -0.19 of its potential returns per unit of risk. Lhyfe SA is currently generating about -0.38 per unit of risk. If you would invest 480.00 in ATEME SA on August 31, 2024 and sell it today you would lose (55.00) from holding ATEME SA or give up 11.46% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
ATEME SA vs. Lhyfe SA
Performance |
| Timeline |
| ATEME SA |
| Lhyfe SA |
ATEME SA and Lhyfe SA Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with ATEME SA and Lhyfe SA
The main advantage of trading using opposite ATEME SA and Lhyfe SA positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if ATEME SA position performs unexpectedly, Lhyfe 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 Lhyfe SA will offset losses from the drop in Lhyfe SA's long position.| ATEME SA vs. Avenir Telecom SA | ATEME SA vs. Novatech Industries SA | ATEME SA vs. Eutelsat Communications SA | ATEME SA vs. Axway Software |
| Lhyfe SA vs. Hydrogene De France | Lhyfe SA vs. Hydrogen Refueling Solutions | Lhyfe SA vs. Neoen SA | Lhyfe SA vs. Hopium SAS |
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 Content Syndication module to quickly integrate customizable finance content to your own investment portal.
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