Correlation Between Cegedim SA and Delfingen
Can any of the company-specific risk be diversified away by investing in both Cegedim SA and Delfingen 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 Cegedim SA and Delfingen into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Cegedim SA and Delfingen, you can compare the effects of market volatilities on Cegedim SA and Delfingen 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 Cegedim SA with a short position of Delfingen. Check out your portfolio center. Please also check ongoing floating volatility patterns of Cegedim SA and Delfingen.
Diversification Opportunities for Cegedim SA and Delfingen
0.82 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between Cegedim and Delfingen is 0.82. Overlapping area represents the amount of risk that can be diversified away by holding Cegedim SA and Delfingen in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Delfingen and Cegedim 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 Cegedim SA are associated (or correlated) with Delfingen. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Delfingen has no effect on the direction of Cegedim SA i.e., Cegedim SA and Delfingen go up and down completely randomly.
Pair Corralation between Cegedim SA and Delfingen
Assuming the 90 days trading horizon Cegedim SA is expected to generate 0.71 times more return on investment than Delfingen. However, Cegedim SA is 1.4 times less risky than Delfingen. It trades about -0.16 of its potential returns per unit of risk. Delfingen is currently generating about -0.63 per unit of risk. If you would invest 1,160 in Cegedim SA on September 3, 2024 and sell it today you would lose (60.00) from holding Cegedim SA or give up 5.17% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Cegedim SA vs. Delfingen
Performance |
| Timeline |
| Cegedim SA |
| Delfingen |
Cegedim SA and Delfingen Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Cegedim SA and Delfingen
The main advantage of trading using opposite Cegedim SA and Delfingen positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Cegedim SA position performs unexpectedly, Delfingen 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 Delfingen will offset losses from the drop in Delfingen's long position.| Cegedim SA vs. Bonduelle SCA | Cegedim SA vs. Boiron SA | Cegedim SA vs. Assystem SA | Cegedim SA vs. Lectra SA |
| Delfingen vs. Akwel SA | Delfingen vs. Groupe Guillin SA | Delfingen vs. Burelle SA | Delfingen vs. SA Catana Group |
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 ETFs module to find actively traded Exchange Traded Funds (ETF) from around the world.
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