Correlation Between Bains Mer and Plastiques
Can any of the company-specific risk be diversified away by investing in both Bains Mer and Plastiques 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 Bains Mer and Plastiques into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Bains Mer Monaco and Plastiques du Val, you can compare the effects of market volatilities on Bains Mer and Plastiques 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 Bains Mer with a short position of Plastiques. Check out your portfolio center. Please also check ongoing floating volatility patterns of Bains Mer and Plastiques.
Diversification Opportunities for Bains Mer and Plastiques
-0.39 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Bains and Plastiques is -0.39. Overlapping area represents the amount of risk that can be diversified away by holding Bains Mer Monaco and Plastiques du Val in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Plastiques du Val and Bains Mer 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 Bains Mer Monaco are associated (or correlated) with Plastiques. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Plastiques du Val has no effect on the direction of Bains Mer i.e., Bains Mer and Plastiques go up and down completely randomly.
Pair Corralation between Bains Mer and Plastiques
Assuming the 90 days trading horizon Bains Mer Monaco is expected to generate 0.58 times more return on investment than Plastiques. However, Bains Mer Monaco is 1.72 times less risky than Plastiques. It trades about -0.01 of its potential returns per unit of risk. Plastiques du Val is currently generating about -0.11 per unit of risk. If you would invest 10,450 in Bains Mer Monaco on November 5, 2024 and sell it today you would lose (50.00) from holding Bains Mer Monaco or give up 0.48% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Bains Mer Monaco vs. Plastiques du Val
Performance |
| Timeline |
| Bains Mer Monaco |
| Plastiques du Val |
Bains Mer and Plastiques Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Bains Mer and Plastiques
The main advantage of trading using opposite Bains Mer and Plastiques positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Bains Mer position performs unexpectedly, Plastiques 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 Plastiques will offset losses from the drop in Plastiques' long position.| Bains Mer vs. Compagnie des Alpes | Bains Mer vs. Groupe Partouche SA | Bains Mer vs. Bnteau SA | Bains Mer vs. Boiron SA |
| Plastiques vs. Groupe Guillin SA | Plastiques vs. Groupe Partouche SA | Plastiques vs. Passat Socit Anonyme | Plastiques vs. Akwel SA |
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 Idea Analyzer module to analyze all characteristics, volatility and risk-adjusted return of Macroaxis ideas.
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