Correlation Between Casino Guichard and Dassault Aviation
Can any of the company-specific risk be diversified away by investing in both Casino Guichard and Dassault Aviation 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 Casino Guichard and Dassault Aviation into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Casino Guichard Perrachon and Dassault Aviation SA, you can compare the effects of market volatilities on Casino Guichard and Dassault Aviation 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 Casino Guichard with a short position of Dassault Aviation. Check out your portfolio center. Please also check ongoing floating volatility patterns of Casino Guichard and Dassault Aviation.
Diversification Opportunities for Casino Guichard and Dassault Aviation
-0.19 | Correlation Coefficient |
Good diversification
The 3 months correlation between Casino and Dassault is -0.19. Overlapping area represents the amount of risk that can be diversified away by holding Casino Guichard Perrachon and Dassault Aviation SA in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Dassault Aviation and Casino Guichard 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 Casino Guichard Perrachon are associated (or correlated) with Dassault Aviation. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Dassault Aviation has no effect on the direction of Casino Guichard i.e., Casino Guichard and Dassault Aviation go up and down completely randomly.
Pair Corralation between Casino Guichard and Dassault Aviation
Assuming the 90 days horizon Casino Guichard Perrachon is expected to under-perform the Dassault Aviation. In addition to that, Casino Guichard is 5.31 times more volatile than Dassault Aviation SA. It trades about -0.13 of its total potential returns per unit of risk. Dassault Aviation SA is currently generating about 0.02 per unit of volatility. If you would invest 17,946 in Dassault Aviation SA on September 3, 2024 and sell it today you would earn a total of 984.00 from holding Dassault Aviation SA or generate 5.48% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 99.6% |
| Values | Daily Returns |
Casino Guichard Perrachon vs. Dassault Aviation SA
Performance |
| Timeline |
| Casino Guichard Perrachon |
| Dassault Aviation |
Casino Guichard and Dassault Aviation Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Casino Guichard and Dassault Aviation
The main advantage of trading using opposite Casino Guichard and Dassault Aviation positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Casino Guichard position performs unexpectedly, Dassault Aviation 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 Dassault Aviation will offset losses from the drop in Dassault Aviation's long position.| Casino Guichard vs. Danone SA | Casino Guichard vs. Renault SA | Casino Guichard vs. AXA SA | Casino Guichard vs. Compagnie de Saint Gobain |
| Dassault Aviation vs. Thales SA | Dassault Aviation vs. Dassault Systemes SE | Dassault Aviation vs. Safran SA | Dassault Aviation vs. Eiffage SA |
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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