Correlation Between Benchmark Electronics and Socit Gnrale
Can any of the company-specific risk be diversified away by investing in both Benchmark Electronics and Socit Gnrale 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 Benchmark Electronics and Socit Gnrale into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Benchmark Electronics and Socit Gnrale Socit, you can compare the effects of market volatilities on Benchmark Electronics and Socit Gnrale 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 Benchmark Electronics with a short position of Socit Gnrale. Check out your portfolio center. Please also check ongoing floating volatility patterns of Benchmark Electronics and Socit Gnrale.
Diversification Opportunities for Benchmark Electronics and Socit Gnrale
0.76 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Benchmark and Socit is 0.76. Overlapping area represents the amount of risk that can be diversified away by holding Benchmark Electronics and Socit Gnrale Socit in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Socit Gnrale Socit and Benchmark Electronics 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 Benchmark Electronics are associated (or correlated) with Socit Gnrale. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Socit Gnrale Socit has no effect on the direction of Benchmark Electronics i.e., Benchmark Electronics and Socit Gnrale go up and down completely randomly.
Pair Corralation between Benchmark Electronics and Socit Gnrale
Assuming the 90 days horizon Benchmark Electronics is expected to generate 3.48 times less return on investment than Socit Gnrale. But when comparing it to its historical volatility, Benchmark Electronics is 1.18 times less risky than Socit Gnrale. It trades about 0.03 of its potential returns per unit of risk. Socit Gnrale Socit is currently generating about 0.1 of returns per unit of risk over similar time horizon. If you would invest 2,619 in Socit Gnrale Socit on September 15, 2024 and sell it today you would earn a total of 99.00 from holding Socit Gnrale Socit or generate 3.78% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 95.65% |
| Values | Daily Returns |
Benchmark Electronics vs. Socit Gnrale Socit
Performance |
| Timeline |
| Benchmark Electronics |
| Socit Gnrale Socit |
Benchmark Electronics and Socit Gnrale Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Benchmark Electronics and Socit Gnrale
The main advantage of trading using opposite Benchmark Electronics and Socit Gnrale positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Benchmark Electronics position performs unexpectedly, Socit Gnrale 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 Socit Gnrale will offset losses from the drop in Socit Gnrale's long position.| Benchmark Electronics vs. Superior Plus Corp | Benchmark Electronics vs. SIVERS SEMICONDUCTORS AB | Benchmark Electronics vs. Norsk Hydro ASA | Benchmark Electronics vs. Reliance Steel Aluminum |
| Socit Gnrale vs. Superior Plus Corp | Socit Gnrale vs. SIVERS SEMICONDUCTORS AB | Socit Gnrale vs. CHINA HUARONG ENERHD 50 | Socit Gnrale vs. NORDIC HALIBUT AS |
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 Bollinger Bands module to use Bollinger Bands indicator to analyze target price for a given investing horizon.
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