Correlation Between Capital Clean and Genfit
Can any of the company-specific risk be diversified away by investing in both Capital Clean and Genfit 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 Capital Clean and Genfit into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Capital Clean Energy and Genfit, you can compare the effects of market volatilities on Capital Clean and Genfit 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 Capital Clean with a short position of Genfit. Check out your portfolio center. Please also check ongoing floating volatility patterns of Capital Clean and Genfit.
Diversification Opportunities for Capital Clean and Genfit
0.72 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Capital and Genfit is 0.72. Overlapping area represents the amount of risk that can be diversified away by holding Capital Clean Energy and Genfit in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Genfit and Capital Clean 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 Capital Clean Energy are associated (or correlated) with Genfit. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Genfit has no effect on the direction of Capital Clean i.e., Capital Clean and Genfit go up and down completely randomly.
Pair Corralation between Capital Clean and Genfit
Given the investment horizon of 90 days Capital Clean is expected to generate 3.0 times less return on investment than Genfit. But when comparing it to its historical volatility, Capital Clean Energy is 2.02 times less risky than Genfit. It trades about 0.02 of its potential returns per unit of risk. Genfit is currently generating about 0.03 of returns per unit of risk over similar time horizon. If you would invest 379.00 in Genfit on August 29, 2024 and sell it today you would earn a total of 44.00 from holding Genfit or generate 11.61% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Capital Clean Energy vs. Genfit
Performance |
| Timeline |
| Capital Clean Energy |
| Genfit |
Capital Clean and Genfit Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Capital Clean and Genfit
The main advantage of trading using opposite Capital Clean and Genfit positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Capital Clean position performs unexpectedly, Genfit 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 Genfit will offset losses from the drop in Genfit's long position.| Capital Clean vs. RadNet Inc | Capital Clean vs. MACOM Technology Solutions | Capital Clean vs. Elmos Semiconductor SE | Capital Clean vs. Lipocine |
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 Idea Optimizer module to use advanced portfolio builder with pre-computed micro ideas to build optimal portfolio .
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