Correlation Between Avenir Telecom and Affluent Medical
Can any of the company-specific risk be diversified away by investing in both Avenir Telecom and Affluent Medical 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 Avenir Telecom and Affluent Medical into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Avenir Telecom SA and Affluent Medical SAS, you can compare the effects of market volatilities on Avenir Telecom and Affluent Medical 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 Avenir Telecom with a short position of Affluent Medical. Check out your portfolio center. Please also check ongoing floating volatility patterns of Avenir Telecom and Affluent Medical.
Diversification Opportunities for Avenir Telecom and Affluent Medical
0.63 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Avenir and Affluent is 0.63. Overlapping area represents the amount of risk that can be diversified away by holding Avenir Telecom SA and Affluent Medical SAS in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Affluent Medical SAS and Avenir Telecom 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 Avenir Telecom SA are associated (or correlated) with Affluent Medical. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Affluent Medical SAS has no effect on the direction of Avenir Telecom i.e., Avenir Telecom and Affluent Medical go up and down completely randomly.
Pair Corralation between Avenir Telecom and Affluent Medical
Assuming the 90 days trading horizon Avenir Telecom SA is expected to generate 1.42 times more return on investment than Affluent Medical. However, Avenir Telecom is 1.42 times more volatile than Affluent Medical SAS. It trades about 0.01 of its potential returns per unit of risk. Affluent Medical SAS is currently generating about 0.02 per unit of risk. If you would invest 13.00 in Avenir Telecom SA on September 3, 2024 and sell it today you would lose (5.83) from holding Avenir Telecom SA or give up 44.85% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Avenir Telecom SA vs. Affluent Medical SAS
Performance |
| Timeline |
| Avenir Telecom SA |
| Affluent Medical SAS |
Avenir Telecom and Affluent Medical Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Avenir Telecom and Affluent Medical
The main advantage of trading using opposite Avenir Telecom and Affluent Medical positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Avenir Telecom position performs unexpectedly, Affluent Medical 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 Affluent Medical will offset losses from the drop in Affluent Medical's long position.| Avenir Telecom vs. Acheter Louer | Avenir Telecom vs. Europlasma SA | Avenir Telecom vs. DBT SA | Avenir Telecom vs. Solocal Group SA |
| Affluent Medical vs. Biosynex | Affluent Medical vs. Novacyt | Affluent Medical vs. Biophytis SA | Affluent Medical vs. Intrasense |
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 Balance Of Power module to check stock momentum by analyzing Balance Of Power indicator and other technical ratios.
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