Correlation Between Amundi CAC and Multi Units
Can any of the company-specific risk be diversified away by investing in both Amundi CAC and Multi Units 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 Multi Units 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 Multi Units Luxembourg, you can compare the effects of market volatilities on Amundi CAC and Multi Units 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 Multi Units. Check out your portfolio center. Please also check ongoing floating volatility patterns of Amundi CAC and Multi Units.
Diversification Opportunities for Amundi CAC and Multi Units
-0.08 | Correlation Coefficient |
Good diversification
The 3 months correlation between Amundi and Multi is -0.08. Overlapping area represents the amount of risk that can be diversified away by holding Amundi CAC 40 and Multi Units Luxembourg in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Multi Units Luxembourg 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 Multi Units. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Multi Units Luxembourg has no effect on the direction of Amundi CAC i.e., Amundi CAC and Multi Units go up and down completely randomly.
Pair Corralation between Amundi CAC and Multi Units
Assuming the 90 days trading horizon Amundi CAC is expected to generate 1.29 times less return on investment than Multi Units. In addition to that, Amundi CAC is 2.87 times more volatile than Multi Units Luxembourg. It trades about 0.03 of its total potential returns per unit of risk. Multi Units Luxembourg is currently generating about 0.09 per unit of volatility. If you would invest 14,564 in Multi Units Luxembourg on September 12, 2024 and sell it today you would earn a total of 1,316 from holding Multi Units Luxembourg or generate 9.04% 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. Multi Units Luxembourg
Performance |
| Timeline |
| Amundi CAC 40 |
| Multi Units Luxembourg |
Amundi CAC and Multi Units Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Amundi CAC and Multi Units
The main advantage of trading using opposite Amundi CAC and Multi Units positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Amundi CAC position performs unexpectedly, Multi Units 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 Multi Units will offset losses from the drop in Multi Units' 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 |
| Multi Units vs. Lyxor UCITS Japan | Multi Units vs. Lyxor UCITS Japan | Multi Units vs. Lyxor UCITS Stoxx | Multi Units vs. Amundi CAC 40 |
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 Theme Ratings module to determine theme ratings based on digital equity recommendations. Macroaxis theme ratings are based on combination of fundamental analysis and risk-adjusted market performance.
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