Correlation Between BURLINGTON STORES and Crdit Agricole
Can any of the company-specific risk be diversified away by investing in both BURLINGTON STORES and Crdit Agricole 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 BURLINGTON STORES and Crdit Agricole into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between BURLINGTON STORES and Crdit Agricole SA, you can compare the effects of market volatilities on BURLINGTON STORES and Crdit Agricole 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 BURLINGTON STORES with a short position of Crdit Agricole. Check out your portfolio center. Please also check ongoing floating volatility patterns of BURLINGTON STORES and Crdit Agricole.
Diversification Opportunities for BURLINGTON STORES and Crdit Agricole
-0.75 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between BURLINGTON and Crdit is -0.75. Overlapping area represents the amount of risk that can be diversified away by holding BURLINGTON STORES and Crdit Agricole SA in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Crdit Agricole SA and BURLINGTON STORES 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 BURLINGTON STORES are associated (or correlated) with Crdit Agricole. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Crdit Agricole SA has no effect on the direction of BURLINGTON STORES i.e., BURLINGTON STORES and Crdit Agricole go up and down completely randomly.
Pair Corralation between BURLINGTON STORES and Crdit Agricole
Assuming the 90 days trading horizon BURLINGTON STORES is expected to generate 1.08 times more return on investment than Crdit Agricole. However, BURLINGTON STORES is 1.08 times more volatile than Crdit Agricole SA. It trades about 0.31 of its potential returns per unit of risk. Crdit Agricole SA is currently generating about 0.03 per unit of risk. If you would invest 24,600 in BURLINGTON STORES on September 14, 2024 and sell it today you would earn a total of 3,400 from holding BURLINGTON STORES or generate 13.82% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
BURLINGTON STORES vs. Crdit Agricole SA
Performance |
| Timeline |
| BURLINGTON STORES |
| Crdit Agricole SA |
BURLINGTON STORES and Crdit Agricole Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with BURLINGTON STORES and Crdit Agricole
The main advantage of trading using opposite BURLINGTON STORES and Crdit Agricole positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if BURLINGTON STORES position performs unexpectedly, Crdit Agricole 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 Crdit Agricole will offset losses from the drop in Crdit Agricole's long position.| BURLINGTON STORES vs. Apple Inc | BURLINGTON STORES vs. Apple Inc | BURLINGTON STORES vs. Apple Inc | BURLINGTON STORES vs. Apple Inc |
| Crdit Agricole vs. Datadog | Crdit Agricole vs. BURLINGTON STORES | Crdit Agricole vs. QURATE RETAIL INC | Crdit Agricole vs. DATANG INTL POW |
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 Aroon Oscillator module to analyze current equity momentum using Aroon Oscillator and other momentum ratios.
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