Correlation Between Axway Software and Sogeclair
Can any of the company-specific risk be diversified away by investing in both Axway Software and Sogeclair 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 Axway Software and Sogeclair into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Axway Software and Sogeclair SA, you can compare the effects of market volatilities on Axway Software and Sogeclair 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 Axway Software with a short position of Sogeclair. Check out your portfolio center. Please also check ongoing floating volatility patterns of Axway Software and Sogeclair.
Diversification Opportunities for Axway Software and Sogeclair
-0.67 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between Axway and Sogeclair is -0.67. Overlapping area represents the amount of risk that can be diversified away by holding Axway Software and Sogeclair SA in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Sogeclair SA and Axway Software 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 Axway Software are associated (or correlated) with Sogeclair. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Sogeclair SA has no effect on the direction of Axway Software i.e., Axway Software and Sogeclair go up and down completely randomly.
Pair Corralation between Axway Software and Sogeclair
Assuming the 90 days trading horizon Axway Software is expected to generate 0.8 times more return on investment than Sogeclair. However, Axway Software is 1.26 times less risky than Sogeclair. It trades about 0.07 of its potential returns per unit of risk. Sogeclair SA is currently generating about 0.02 per unit of risk. If you would invest 2,129 in Axway Software on August 26, 2024 and sell it today you would earn a total of 641.00 from holding Axway Software or generate 30.11% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Axway Software vs. Sogeclair SA
Performance |
| Timeline |
| Axway Software |
| Sogeclair SA |
Axway Software and Sogeclair Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Axway Software and Sogeclair
The main advantage of trading using opposite Axway Software and Sogeclair positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Axway Software position performs unexpectedly, Sogeclair 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 Sogeclair will offset losses from the drop in Sogeclair's long position.| Axway Software vs. Sopra Steria Group | Axway Software vs. Aubay Socit Anonyme | Axway Software vs. Lectra SA | Axway Software vs. Esker SA |
| Sogeclair vs. Metalliance SA | Sogeclair vs. CMG Cleantech SA | Sogeclair vs. Groupe Pizzorno Environnement | Sogeclair vs. Fill Up Media |
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 Portfolio Comparator module to compare the composition, asset allocations and performance of any two portfolios in your account.
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