Correlation Between SA Catana and Axway Software
Can any of the company-specific risk be diversified away by investing in both SA Catana and Axway Software 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 Axway Software 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 Axway Software, you can compare the effects of market volatilities on SA Catana and Axway Software 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 Axway Software. Check out your portfolio center. Please also check ongoing floating volatility patterns of SA Catana and Axway Software.
Diversification Opportunities for SA Catana and Axway Software
0.01 | Correlation Coefficient |
Significant diversification
The 3 months correlation between CATG and Axway is 0.01. Overlapping area represents the amount of risk that can be diversified away by holding SA Catana Group and Axway Software in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Axway Software 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 Axway Software. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Axway Software has no effect on the direction of SA Catana i.e., SA Catana and Axway Software go up and down completely randomly.
Pair Corralation between SA Catana and Axway Software
Assuming the 90 days trading horizon SA Catana Group is expected to under-perform the Axway Software. In addition to that, SA Catana is 1.51 times more volatile than Axway Software. It trades about -0.03 of its total potential returns per unit of risk. Axway Software is currently generating about 0.06 per unit of volatility. If you would invest 2,120 in Axway Software on September 12, 2024 and sell it today you would earn a total of 620.00 from holding Axway Software or generate 29.25% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
SA Catana Group vs. Axway Software
Performance |
| Timeline |
| SA Catana Group |
| Axway Software |
SA Catana and Axway Software Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with SA Catana and Axway Software
The main advantage of trading using opposite SA Catana and Axway Software positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if SA Catana position performs unexpectedly, Axway Software 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 Axway Software will offset losses from the drop in Axway Software's long position.| SA Catana vs. Trigano SA | SA Catana vs. Bnteau SA | SA Catana vs. Fountaine Pajo | SA Catana vs. Piscines Desjoyaux SA |
| Axway Software vs. Groupe Guillin SA | Axway Software vs. Stef SA | Axway Software vs. SA Catana Group | Axway Software 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 Portfolio Rebalancing module to analyze risk-adjusted returns against different time horizons to find asset-allocation targets.
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