Correlation Between Socit BIC and Pernod Ricard
Can any of the company-specific risk be diversified away by investing in both Socit BIC and Pernod Ricard 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 Socit BIC and Pernod Ricard into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Socit BIC SA and Pernod Ricard SA, you can compare the effects of market volatilities on Socit BIC and Pernod Ricard 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 Socit BIC with a short position of Pernod Ricard. Check out your portfolio center. Please also check ongoing floating volatility patterns of Socit BIC and Pernod Ricard.
Diversification Opportunities for Socit BIC and Pernod Ricard
-0.61 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between Socit and Pernod is -0.61. Overlapping area represents the amount of risk that can be diversified away by holding Socit BIC SA and Pernod Ricard SA in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Pernod Ricard SA and Socit BIC 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 Socit BIC SA are associated (or correlated) with Pernod Ricard. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Pernod Ricard SA has no effect on the direction of Socit BIC i.e., Socit BIC and Pernod Ricard go up and down completely randomly.
Pair Corralation between Socit BIC and Pernod Ricard
Assuming the 90 days horizon Socit BIC SA is expected to generate 1.09 times more return on investment than Pernod Ricard. However, Socit BIC is 1.09 times more volatile than Pernod Ricard SA. It trades about 0.02 of its potential returns per unit of risk. Pernod Ricard SA is currently generating about -0.07 per unit of risk. If you would invest 5,742 in Socit BIC SA on September 3, 2024 and sell it today you would earn a total of 568.00 from holding Socit BIC SA or generate 9.89% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Socit BIC SA vs. Pernod Ricard SA
Performance |
| Timeline |
| Socit BIC SA |
| Pernod Ricard SA |
Socit BIC and Pernod Ricard Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Socit BIC and Pernod Ricard
The main advantage of trading using opposite Socit BIC and Pernod Ricard positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Socit BIC position performs unexpectedly, Pernod Ricard 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 Pernod Ricard will offset losses from the drop in Pernod Ricard's long position.| Socit BIC vs. Imerys SA | Socit BIC vs. Casino Guichard Perrachon | Socit BIC vs. SEB SA | Socit BIC vs. Mtropole Tlvision SA |
| Pernod Ricard vs. LOreal SA | Pernod Ricard vs. Danone SA | Pernod Ricard vs. Compagnie Generale des | Pernod Ricard vs. Air Liquide 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 Volatility Analysis module to get historical volatility and risk analysis based on latest market data.
Other Complementary Tools
| CEOs Directory Screen CEOs from public companies around the world | |
| Share Portfolio Track or share privately all of your investments from the convenience of any device | |
| Portfolio Backtesting Avoid under-diversification and over-optimization by backtesting your portfolios | |
| Global Correlations Find global opportunities by holding instruments from different markets | |
| Fundamental Analysis View fundamental data based on most recent published financial statements |