Correlation Between Consolidated Communications and SES SA
Can any of the company-specific risk be diversified away by investing in both Consolidated Communications and SES SA 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 Consolidated Communications and SES SA into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Consolidated Communications Holdings and SES SA, you can compare the effects of market volatilities on Consolidated Communications and SES SA 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 Consolidated Communications with a short position of SES SA. Check out your portfolio center. Please also check ongoing floating volatility patterns of Consolidated Communications and SES SA.
Diversification Opportunities for Consolidated Communications and SES SA
-0.93 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between Consolidated and SES is -0.93. Overlapping area represents the amount of risk that can be diversified away by holding Consolidated Communications Ho and SES SA in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on SES SA and Consolidated Communications 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 Consolidated Communications Holdings are associated (or correlated) with SES SA. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of SES SA has no effect on the direction of Consolidated Communications i.e., Consolidated Communications and SES SA go up and down completely randomly.
Pair Corralation between Consolidated Communications and SES SA
Assuming the 90 days horizon Consolidated Communications Holdings is expected to generate 0.5 times more return on investment than SES SA. However, Consolidated Communications Holdings is 2.01 times less risky than SES SA. It trades about 0.09 of its potential returns per unit of risk. SES SA is currently generating about -0.15 per unit of risk. If you would invest 402.00 in Consolidated Communications Holdings on August 29, 2024 and sell it today you would earn a total of 40.00 from holding Consolidated Communications Holdings or generate 9.95% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Consolidated Communications Ho vs. SES SA
Performance |
| Timeline |
| Consolidated Communications |
| SES SA |
Consolidated Communications and SES SA Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Consolidated Communications and SES SA
The main advantage of trading using opposite Consolidated Communications and SES SA positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Consolidated Communications position performs unexpectedly, SES SA 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 SES SA will offset losses from the drop in SES SA's long position.| Consolidated Communications vs. Harmony Gold Mining | Consolidated Communications vs. USWE SPORTS AB | Consolidated Communications vs. SPORT LISBOA E | Consolidated Communications vs. Columbia Sportswear |
| SES SA vs. KRISPY KREME DL 01 | SES SA vs. Consolidated Communications Holdings | SES SA vs. INTER CARS SA | SES SA vs. GRUPO CARSO A1 |
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 Correlation Analysis module to reduce portfolio risk simply by holding instruments which are not perfectly correlated.
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