Correlation Between Carrefour and Om Holdings
Can any of the company-specific risk be diversified away by investing in both Carrefour and Om Holdings 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 Carrefour and Om Holdings into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Carrefour SA PK and Om Holdings International, you can compare the effects of market volatilities on Carrefour and Om Holdings 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 Carrefour with a short position of Om Holdings. Check out your portfolio center. Please also check ongoing floating volatility patterns of Carrefour and Om Holdings.
Diversification Opportunities for Carrefour and Om Holdings
0.35 | Correlation Coefficient |
Weak diversification
The 3 months correlation between Carrefour and OMHI is 0.35. Overlapping area represents the amount of risk that can be diversified away by holding Carrefour SA PK and Om Holdings International in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Om Holdings International and Carrefour 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 Carrefour SA PK are associated (or correlated) with Om Holdings. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Om Holdings International has no effect on the direction of Carrefour i.e., Carrefour and Om Holdings go up and down completely randomly.
Pair Corralation between Carrefour and Om Holdings
Assuming the 90 days horizon Carrefour SA PK is expected to generate 0.2 times more return on investment than Om Holdings. However, Carrefour SA PK is 5.06 times less risky than Om Holdings. It trades about -0.01 of its potential returns per unit of risk. Om Holdings International is currently generating about -0.05 per unit of risk. If you would invest 337.00 in Carrefour SA PK on August 31, 2024 and sell it today you would lose (28.00) from holding Carrefour SA PK or give up 8.31% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Carrefour SA PK vs. Om Holdings International
Performance |
| Timeline |
| Carrefour SA PK |
| Om Holdings International |
Carrefour and Om Holdings Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Carrefour and Om Holdings
The main advantage of trading using opposite Carrefour and Om Holdings positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Carrefour position performs unexpectedly, Om Holdings 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 Om Holdings will offset losses from the drop in Om Holdings' long position.| Carrefour vs. Kesko Oyj ADR | Carrefour vs. Carrefour SA | Carrefour vs. J Sainsbury plc | Carrefour vs. Om Holdings International |
| Om Holdings vs. Tesco PLC | Om Holdings vs. Woolworths Group Limited | Om Holdings vs. Kesko Oyj ADR | Om Holdings vs. Carrefour SA PK |
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 Insider Screener module to find insiders across different sectors to evaluate their impact on performance.
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