Correlation Between Caisse Rgionale and Poxel SA
Can any of the company-specific risk be diversified away by investing in both Caisse Rgionale and Poxel SA 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 Caisse Rgionale and Poxel SA into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Caisse Rgionale du and Poxel SA, you can compare the effects of market volatilities on Caisse Rgionale and Poxel SA 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 Caisse Rgionale with a short position of Poxel SA. Check out your portfolio center. Please also check ongoing floating volatility patterns of Caisse Rgionale and Poxel SA.
Diversification Opportunities for Caisse Rgionale and Poxel SA
-0.67 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between Caisse and Poxel is -0.67. Overlapping area represents the amount of risk that can be diversified away by holding Caisse Rgionale du and Poxel SA in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Poxel SA and Caisse Rgionale 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 Caisse Rgionale du are associated (or correlated) with Poxel SA. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Poxel SA has no effect on the direction of Caisse Rgionale i.e., Caisse Rgionale and Poxel SA go up and down completely randomly.
Pair Corralation between Caisse Rgionale and Poxel SA
Assuming the 90 days trading horizon Caisse Rgionale du is expected to generate 0.46 times more return on investment than Poxel SA. However, Caisse Rgionale du is 2.17 times less risky than Poxel SA. It trades about 0.07 of its potential returns per unit of risk. Poxel SA is currently generating about -0.65 per unit of risk. If you would invest 7,501 in Caisse Rgionale du on August 30, 2024 and sell it today you would earn a total of 149.00 from holding Caisse Rgionale du or generate 1.99% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Caisse Rgionale du vs. Poxel SA
Performance |
| Timeline |
| Caisse Rgionale du |
| Poxel SA |
Caisse Rgionale and Poxel SA Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Caisse Rgionale and Poxel SA
The main advantage of trading using opposite Caisse Rgionale and Poxel SA positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Caisse Rgionale position performs unexpectedly, Poxel SA 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 Poxel SA will offset losses from the drop in Poxel SA's long position.| Caisse Rgionale vs. Caisse rgionale de | Caisse Rgionale vs. Caisse Regionale de | Caisse Rgionale vs. Caisse Regionale de | Caisse Rgionale vs. Manitou BF 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 Portfolio Optimization module to compute new portfolio that will generate highest expected return given your specified tolerance for risk.
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