Correlation Between Casino Guichard and Derichebourg
Can any of the company-specific risk be diversified away by investing in both Casino Guichard and Derichebourg 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 Derichebourg 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 Derichebourg, you can compare the effects of market volatilities on Casino Guichard and Derichebourg 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 Derichebourg. Check out your portfolio center. Please also check ongoing floating volatility patterns of Casino Guichard and Derichebourg.
Diversification Opportunities for Casino Guichard and Derichebourg
0.58 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Casino and Derichebourg is 0.58. Overlapping area represents the amount of risk that can be diversified away by holding Casino Guichard Perrachon and Derichebourg in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Derichebourg 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 Derichebourg. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Derichebourg has no effect on the direction of Casino Guichard i.e., Casino Guichard and Derichebourg go up and down completely randomly.
Pair Corralation between Casino Guichard and Derichebourg
Assuming the 90 days horizon Casino Guichard Perrachon is expected to under-perform the Derichebourg. In addition to that, Casino Guichard is 2.24 times more volatile than Derichebourg. It trades about -0.15 of its total potential returns per unit of risk. Derichebourg is currently generating about -0.03 per unit of volatility. If you would invest 504.00 in Derichebourg on September 2, 2024 and sell it today you would lose (47.00) from holding Derichebourg or give up 9.33% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Casino Guichard Perrachon vs. Derichebourg
Performance |
| Timeline |
| Casino Guichard Perrachon |
| Derichebourg |
Casino Guichard and Derichebourg Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Casino Guichard and Derichebourg
The main advantage of trading using opposite Casino Guichard and Derichebourg positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Casino Guichard position performs unexpectedly, Derichebourg 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 Derichebourg will offset losses from the drop in Derichebourg'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 |
| Derichebourg vs. Edenred SA | Derichebourg vs. Legrand SA | Derichebourg vs. Sodexo SA | Derichebourg vs. Wendel |
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 Anywhere module to track or share privately all of your investments from the convenience of any device.
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