Correlation Between Amundi CAC and Amundi PEA
Can any of the company-specific risk be diversified away by investing in both Amundi CAC and Amundi PEA 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 Amundi PEA 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 Amundi PEA Eau, you can compare the effects of market volatilities on Amundi CAC and Amundi PEA 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 Amundi PEA. Check out your portfolio center. Please also check ongoing floating volatility patterns of Amundi CAC and Amundi PEA.
Diversification Opportunities for Amundi CAC and Amundi PEA
-0.28 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Amundi and Amundi is -0.28. Overlapping area represents the amount of risk that can be diversified away by holding Amundi CAC 40 and Amundi PEA Eau in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Amundi PEA Eau 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 Amundi PEA. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Amundi PEA Eau has no effect on the direction of Amundi CAC i.e., Amundi CAC and Amundi PEA go up and down completely randomly.
Pair Corralation between Amundi CAC and Amundi PEA
Assuming the 90 days trading horizon Amundi CAC 40 is expected to under-perform the Amundi PEA. But the etf apears to be less risky and, when comparing its historical volatility, Amundi CAC 40 is 1.33 times less risky than Amundi PEA. The etf trades about -0.26 of its potential returns per unit of risk. The Amundi PEA Eau is currently generating about 0.16 of returns per unit of risk over similar time horizon. If you would invest 3,090 in Amundi PEA Eau on August 29, 2024 and sell it today you would earn a total of 135.00 from holding Amundi PEA Eau or generate 4.37% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Amundi CAC 40 vs. Amundi PEA Eau
Performance |
| Timeline |
| Amundi CAC 40 |
| Amundi PEA Eau |
Amundi CAC and Amundi PEA Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Amundi CAC and Amundi PEA
The main advantage of trading using opposite Amundi CAC and Amundi PEA positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Amundi CAC position performs unexpectedly, Amundi PEA 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 Amundi PEA will offset losses from the drop in Amundi PEA'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 |
| Amundi PEA vs. Amundi Index Solutions | Amundi PEA vs. Amundi Index Solutions | Amundi PEA vs. Amundi Index Solutions | Amundi PEA vs. Amundi SP 500 |
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 Funds Screener module to find actively-traded funds from around the world traded on over 30 global exchanges.
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