Correlation Between Amundi CAC and Granite 3x
Can any of the company-specific risk be diversified away by investing in both Amundi CAC and Granite 3x 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 Amundi CAC and Granite 3x into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Amundi CAC 40 and Granite 3x LVMH, you can compare the effects of market volatilities on Amundi CAC and Granite 3x 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 Amundi CAC with a short position of Granite 3x. Check out your portfolio center. Please also check ongoing floating volatility patterns of Amundi CAC and Granite 3x.
Diversification Opportunities for Amundi CAC and Granite 3x
0.5 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Amundi and Granite is 0.5. Overlapping area represents the amount of risk that can be diversified away by holding Amundi CAC 40 and Granite 3x LVMH in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Granite 3x LVMH and Amundi CAC 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 Amundi CAC 40 are associated (or correlated) with Granite 3x. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Granite 3x LVMH has no effect on the direction of Amundi CAC i.e., Amundi CAC and Granite 3x go up and down completely randomly.
Pair Corralation between Amundi CAC and Granite 3x
Assuming the 90 days trading horizon Amundi CAC 40 is expected to generate 0.16 times more return on investment than Granite 3x. However, Amundi CAC 40 is 6.26 times less risky than Granite 3x. It trades about -0.18 of its potential returns per unit of risk. Granite 3x LVMH is currently generating about -0.15 per unit of risk. If you would invest 7,585 in Amundi CAC 40 on August 24, 2024 and sell it today you would lose (286.00) from holding Amundi CAC 40 or give up 3.77% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 95.65% |
| Values | Daily Returns |
Amundi CAC 40 vs. Granite 3x LVMH
Performance |
| Timeline |
| Amundi CAC 40 |
| Granite 3x LVMH |
Amundi CAC and Granite 3x Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Amundi CAC and Granite 3x
The main advantage of trading using opposite Amundi CAC and Granite 3x positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Amundi CAC position performs unexpectedly, Granite 3x 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 Granite 3x will offset losses from the drop in Granite 3x's long position.| Amundi CAC vs. Deutsche Telekom AG | Amundi CAC vs. Volkswagen AG | Amundi CAC vs. Bayerische Motoren Werke | Amundi CAC vs. Mnchener Rck AG |
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 Price Ceiling Movement module to calculate and plot Price Ceiling Movement for different equity instruments.
Other Complementary Tools
| Money Managers Screen money managers from public funds and ETFs managed around the world | |
| Competition Analyzer Analyze and compare many basic indicators for a group of related or unrelated entities | |
| Fundamentals Comparison Compare fundamentals across multiple equities to find investing opportunities | |
| Portfolio Holdings Check your current holdings and cash postion to detemine if your portfolio needs rebalancing | |
| Alpha Finder Use alpha and beta coefficients to find investment opportunities after accounting for the risk |