Correlation Between Carmila SA and Burelle SA
Can any of the company-specific risk be diversified away by investing in both Carmila SA and Burelle SA 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 Burelle SA into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Carmila SA and Burelle SA, you can compare the effects of market volatilities on Carmila SA and Burelle SA 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 Burelle SA. Check out your portfolio center. Please also check ongoing floating volatility patterns of Carmila SA and Burelle SA.
Diversification Opportunities for Carmila SA and Burelle SA
0.5 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Carmila and Burelle is 0.5. Overlapping area represents the amount of risk that can be diversified away by holding Carmila SA and Burelle SA in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Burelle 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 Burelle SA. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Burelle SA has no effect on the direction of Carmila SA i.e., Carmila SA and Burelle SA go up and down completely randomly.
Pair Corralation between Carmila SA and Burelle SA
Assuming the 90 days trading horizon Carmila SA is expected to generate 0.57 times more return on investment than Burelle SA. However, Carmila SA is 1.75 times less risky than Burelle SA. It trades about -0.04 of its potential returns per unit of risk. Burelle SA is currently generating about -0.1 per unit of risk. If you would invest 1,778 in Carmila SA on September 1, 2024 and sell it today you would lose (128.00) from holding Carmila SA or give up 7.2% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Carmila SA vs. Burelle SA
Performance |
| Timeline |
| Carmila SA |
| Burelle SA |
Carmila SA and Burelle SA Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Carmila SA and Burelle SA
The main advantage of trading using opposite Carmila SA and Burelle SA positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Carmila SA position performs unexpectedly, Burelle SA 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 Burelle SA will offset losses from the drop in Burelle SA's long position.| Carmila SA vs. Mercialys SA | Carmila SA vs. Icade SA | Carmila SA vs. Klepierre SA | Carmila SA vs. Altarea SCA |
| Burelle SA vs. Compagnie Generale des | Burelle SA vs. Renault SA | Burelle SA vs. Atos SE | Burelle SA vs. Compagnie de Saint Gobain |
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 Transaction History module to view history of all your transactions and understand their impact on performance.
Other Complementary Tools
| Watchlist Optimization Optimize watchlists to build efficient portfolios or rebalance existing positions based on the mean-variance optimization algorithm | |
| Global Markets Map Get a quick overview of global market snapshot using zoomable world map. Drill down to check world indexes | |
| Performance Analysis Check effects of mean-variance optimization against your current asset allocation | |
| Companies Directory Evaluate performance of over 100,000 Stocks, Funds, and ETFs against different fundamentals | |
| Pattern Recognition Use different Pattern Recognition models to time the market across multiple global exchanges |