Correlation Between Bouygues and Aecom Technology
Can any of the company-specific risk be diversified away by investing in both Bouygues and Aecom Technology 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 Bouygues and Aecom Technology into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Bouygues SA ADR and Aecom Technology, you can compare the effects of market volatilities on Bouygues and Aecom Technology 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 Bouygues with a short position of Aecom Technology. Check out your portfolio center. Please also check ongoing floating volatility patterns of Bouygues and Aecom Technology.
Diversification Opportunities for Bouygues and Aecom Technology
-0.86 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between Bouygues and Aecom is -0.86. Overlapping area represents the amount of risk that can be diversified away by holding Bouygues SA ADR and Aecom Technology in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Aecom Technology and Bouygues 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 Bouygues SA ADR are associated (or correlated) with Aecom Technology. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Aecom Technology has no effect on the direction of Bouygues i.e., Bouygues and Aecom Technology go up and down completely randomly.
Pair Corralation between Bouygues and Aecom Technology
Assuming the 90 days horizon Bouygues SA ADR is expected to under-perform the Aecom Technology. In addition to that, Bouygues is 1.02 times more volatile than Aecom Technology. It trades about 0.0 of its total potential returns per unit of risk. Aecom Technology is currently generating about 0.08 per unit of volatility. If you would invest 8,188 in Aecom Technology on August 31, 2024 and sell it today you would earn a total of 3,509 from holding Aecom Technology or generate 42.86% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Bouygues SA ADR vs. Aecom Technology
Performance |
| Timeline |
| Bouygues SA ADR |
| Aecom Technology |
Bouygues and Aecom Technology Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Bouygues and Aecom Technology
The main advantage of trading using opposite Bouygues and Aecom Technology positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Bouygues position performs unexpectedly, Aecom Technology 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 Aecom Technology will offset losses from the drop in Aecom Technology's long position.| Bouygues vs. SNC Lavalin Group | Bouygues vs. WSP Global | Bouygues vs. Willdan Group | Bouygues vs. Comfort Systems USA |
| Aecom Technology vs. CRA International | Aecom Technology vs. Huron Consulting Group | Aecom Technology vs. Forrester Research | Aecom Technology vs. Resources Connection |
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 Top Crypto Exchanges module to search and analyze digital assets across top global cryptocurrency exchanges.
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