Correlation Between Bonduelle SCA and Sapmer
Can any of the company-specific risk be diversified away by investing in both Bonduelle SCA and Sapmer 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 Bonduelle SCA and Sapmer into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Bonduelle SCA and Sapmer, you can compare the effects of market volatilities on Bonduelle SCA and Sapmer 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 Bonduelle SCA with a short position of Sapmer. Check out your portfolio center. Please also check ongoing floating volatility patterns of Bonduelle SCA and Sapmer.
Diversification Opportunities for Bonduelle SCA and Sapmer
-0.04 | Correlation Coefficient |
Good diversification
The 3 months correlation between Bonduelle and Sapmer is -0.04. Overlapping area represents the amount of risk that can be diversified away by holding Bonduelle SCA and Sapmer in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Sapmer and Bonduelle SCA 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 Bonduelle SCA are associated (or correlated) with Sapmer. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Sapmer has no effect on the direction of Bonduelle SCA i.e., Bonduelle SCA and Sapmer go up and down completely randomly.
Pair Corralation between Bonduelle SCA and Sapmer
Assuming the 90 days trading horizon Bonduelle SCA is expected to under-perform the Sapmer. But the stock apears to be less risky and, when comparing its historical volatility, Bonduelle SCA is 2.51 times less risky than Sapmer. The stock trades about -0.09 of its potential returns per unit of risk. The Sapmer is currently generating about 0.01 of returns per unit of risk over similar time horizon. If you would invest 870.00 in Sapmer on September 14, 2024 and sell it today you would lose (155.00) from holding Sapmer or give up 17.82% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 99.6% |
| Values | Daily Returns |
Bonduelle SCA vs. Sapmer
Performance |
| Timeline |
| Bonduelle SCA |
| Sapmer |
Bonduelle SCA and Sapmer Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Bonduelle SCA and Sapmer
The main advantage of trading using opposite Bonduelle SCA and Sapmer positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Bonduelle SCA position performs unexpectedly, Sapmer 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 Sapmer will offset losses from the drop in Sapmer's long position.| Bonduelle SCA vs. Socit BIC SA | Bonduelle SCA vs. Bnteau SA | Bonduelle SCA vs. Casino Guichard Perrachon | Bonduelle SCA vs. SEB 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 Portfolio Volatility module to check portfolio volatility and analyze historical return density to properly model market risk.
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