Correlation Between SA Catana and Bd Multimedia
Can any of the company-specific risk be diversified away by investing in both SA Catana and Bd Multimedia 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 SA Catana and Bd Multimedia into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between SA Catana Group and Bd Multimedia, you can compare the effects of market volatilities on SA Catana and Bd Multimedia 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 SA Catana with a short position of Bd Multimedia. Check out your portfolio center. Please also check ongoing floating volatility patterns of SA Catana and Bd Multimedia.
Diversification Opportunities for SA Catana and Bd Multimedia
0.36 | Correlation Coefficient |
Weak diversification
The 3 months correlation between CATG and ALBDM is 0.36. Overlapping area represents the amount of risk that can be diversified away by holding SA Catana Group and Bd Multimedia in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Bd Multimedia and SA Catana 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 SA Catana Group are associated (or correlated) with Bd Multimedia. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Bd Multimedia has no effect on the direction of SA Catana i.e., SA Catana and Bd Multimedia go up and down completely randomly.
Pair Corralation between SA Catana and Bd Multimedia
Assuming the 90 days trading horizon SA Catana Group is expected to generate 0.47 times more return on investment than Bd Multimedia. However, SA Catana Group is 2.15 times less risky than Bd Multimedia. It trades about 0.06 of its potential returns per unit of risk. Bd Multimedia is currently generating about -0.33 per unit of risk. If you would invest 484.00 in SA Catana Group on September 13, 2024 and sell it today you would earn a total of 15.00 from holding SA Catana Group or generate 3.1% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
SA Catana Group vs. Bd Multimedia
Performance |
| Timeline |
| SA Catana Group |
| Bd Multimedia |
SA Catana and Bd Multimedia Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with SA Catana and Bd Multimedia
The main advantage of trading using opposite SA Catana and Bd Multimedia positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if SA Catana position performs unexpectedly, Bd Multimedia 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 Bd Multimedia will offset losses from the drop in Bd Multimedia's long position.| SA Catana vs. Trigano SA | SA Catana vs. Bnteau SA | SA Catana vs. Fountaine Pajo | SA Catana vs. Piscines Desjoyaux SA |
| Bd Multimedia vs. Groupe Guillin SA | Bd Multimedia vs. Stef SA | Bd Multimedia vs. SA Catana Group | Bd Multimedia vs. Jacquet Metal Service |
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 Forecasting module to use basic forecasting models to generate price predictions and determine price momentum.
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