Correlation Between Capgemini and IDS France
Can any of the company-specific risk be diversified away by investing in both Capgemini and IDS France 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 Capgemini and IDS France into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Capgemini SE and IDS France SAS, you can compare the effects of market volatilities on Capgemini and IDS France 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 Capgemini with a short position of IDS France. Check out your portfolio center. Please also check ongoing floating volatility patterns of Capgemini and IDS France.
Diversification Opportunities for Capgemini and IDS France
-0.32 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Capgemini and IDS is -0.32. Overlapping area represents the amount of risk that can be diversified away by holding Capgemini SE and IDS France SAS in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on IDS France SAS and Capgemini 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 Capgemini SE are associated (or correlated) with IDS France. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of IDS France SAS has no effect on the direction of Capgemini i.e., Capgemini and IDS France go up and down completely randomly.
Pair Corralation between Capgemini and IDS France
If you would invest 49.00 in IDS France SAS on August 28, 2024 and sell it today you would earn a total of 0.00 from holding IDS France SAS or generate 0.0% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 95.45% |
| Values | Daily Returns |
Capgemini SE vs. IDS France SAS
Performance |
| Timeline |
| Capgemini SE |
| IDS France SAS |
Capgemini and IDS France Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Capgemini and IDS France
The main advantage of trading using opposite Capgemini and IDS France positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Capgemini position performs unexpectedly, IDS France 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 IDS France will offset losses from the drop in IDS France's long position.| Capgemini vs. Atos SE | Capgemini vs. Compagnie de Saint Gobain | Capgemini vs. Pernod Ricard SA | Capgemini vs. Bouygues SA |
| IDS France vs. Thales SA | IDS France vs. Safran SA | IDS France vs. Air Liquide SA | IDS France vs. Capgemini SE |
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 Equity Valuation module to check real value of public entities based on technical and fundamental data.
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