Correlation Between Carmila SA and Groupimo
Can any of the company-specific risk be diversified away by investing in both Carmila SA and Groupimo 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 Carmila SA and Groupimo into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Carmila SA and Groupimo SA, you can compare the effects of market volatilities on Carmila SA and Groupimo 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 Carmila SA with a short position of Groupimo. Check out your portfolio center. Please also check ongoing floating volatility patterns of Carmila SA and Groupimo.
Diversification Opportunities for Carmila SA and Groupimo
-0.55 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between Carmila and Groupimo is -0.55. Overlapping area represents the amount of risk that can be diversified away by holding Carmila SA and Groupimo SA in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Groupimo SA and Carmila SA 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 Carmila SA are associated (or correlated) with Groupimo. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Groupimo SA has no effect on the direction of Carmila SA i.e., Carmila SA and Groupimo go up and down completely randomly.
Pair Corralation between Carmila SA and Groupimo
Assuming the 90 days trading horizon Carmila SA is expected to under-perform the Groupimo. But the stock apears to be less risky and, when comparing its historical volatility, Carmila SA is 20.59 times less risky than Groupimo. The stock trades about -0.21 of its potential returns per unit of risk. The Groupimo SA is currently generating about 0.0 of returns per unit of risk over similar time horizon. If you would invest 29.00 in Groupimo SA on September 1, 2024 and sell it today you would lose (10.00) from holding Groupimo SA or give up 34.48% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 95.65% |
| Values | Daily Returns |
Carmila SA vs. Groupimo SA
Performance |
| Timeline |
| Carmila SA |
| Groupimo SA |
Carmila SA and Groupimo Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Carmila SA and Groupimo
The main advantage of trading using opposite Carmila SA and Groupimo positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Carmila SA position performs unexpectedly, Groupimo 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 Groupimo will offset losses from the drop in Groupimo's long position.| Carmila SA vs. Mercialys SA | Carmila SA vs. Icade SA | Carmila SA vs. Klepierre SA | Carmila SA vs. Altarea SCA |
| Groupimo vs. Altarea SCA | Groupimo vs. Carmila SA | Groupimo vs. Manitou BF SA | Groupimo vs. Ossiam Minimum Variance |
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 Premium Stories module to follow Macroaxis premium stories from verified contributors across different equity types, categories and coverage scope.
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