Correlation Between Bureau Veritas and Altamir SCA
Can any of the company-specific risk be diversified away by investing in both Bureau Veritas and Altamir SCA 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 Bureau Veritas and Altamir SCA into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Bureau Veritas SA and Altamir SCA, you can compare the effects of market volatilities on Bureau Veritas and Altamir SCA 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 Bureau Veritas with a short position of Altamir SCA. Check out your portfolio center. Please also check ongoing floating volatility patterns of Bureau Veritas and Altamir SCA.
Diversification Opportunities for Bureau Veritas and Altamir SCA
0.72 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Bureau and Altamir is 0.72. Overlapping area represents the amount of risk that can be diversified away by holding Bureau Veritas SA and Altamir SCA in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Altamir SCA and Bureau Veritas 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 Bureau Veritas SA are associated (or correlated) with Altamir SCA. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Altamir SCA has no effect on the direction of Bureau Veritas i.e., Bureau Veritas and Altamir SCA go up and down completely randomly.
Pair Corralation between Bureau Veritas and Altamir SCA
Assuming the 90 days trading horizon Bureau Veritas SA is expected to generate 0.99 times more return on investment than Altamir SCA. However, Bureau Veritas SA is 1.01 times less risky than Altamir SCA. It trades about 0.03 of its potential returns per unit of risk. Altamir SCA is currently generating about -0.01 per unit of risk. If you would invest 2,442 in Bureau Veritas SA on August 31, 2024 and sell it today you would earn a total of 438.00 from holding Bureau Veritas SA or generate 17.94% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 99.79% |
| Values | Daily Returns |
Bureau Veritas SA vs. Altamir SCA
Performance |
| Timeline |
| Bureau Veritas SA |
| Altamir SCA |
Bureau Veritas and Altamir SCA Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Bureau Veritas and Altamir SCA
The main advantage of trading using opposite Bureau Veritas and Altamir SCA positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Bureau Veritas position performs unexpectedly, Altamir SCA 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 Altamir SCA will offset losses from the drop in Altamir SCA's long position.| Bureau Veritas vs. Edenred SA | Bureau Veritas vs. Legrand SA | Bureau Veritas vs. Sodexo SA | Bureau Veritas vs. Wendel |
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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 Idea Breakdown module to analyze constituents of all Macroaxis ideas. Macroaxis investment ideas are predefined, sector-focused investing themes.
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