Correlation Between Carmat SA and MSAD INSURANCE
Can any of the company-specific risk be diversified away by investing in both Carmat SA and MSAD INSURANCE 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 Carmat SA and MSAD INSURANCE into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Carmat SA and MSAD INSURANCE, you can compare the effects of market volatilities on Carmat SA and MSAD INSURANCE 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 Carmat SA with a short position of MSAD INSURANCE. Check out your portfolio center. Please also check ongoing floating volatility patterns of Carmat SA and MSAD INSURANCE.
Diversification Opportunities for Carmat SA and MSAD INSURANCE
-0.6 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between Carmat and MSAD is -0.6. Overlapping area represents the amount of risk that can be diversified away by holding Carmat SA and MSAD INSURANCE in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on MSAD INSURANCE and Carmat 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 Carmat SA are associated (or correlated) with MSAD INSURANCE. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of MSAD INSURANCE has no effect on the direction of Carmat SA i.e., Carmat SA and MSAD INSURANCE go up and down completely randomly.
Pair Corralation between Carmat SA and MSAD INSURANCE
Assuming the 90 days horizon Carmat SA is expected to under-perform the MSAD INSURANCE. In addition to that, Carmat SA is 3.56 times more volatile than MSAD INSURANCE. It trades about -0.05 of its total potential returns per unit of risk. MSAD INSURANCE is currently generating about 0.1 per unit of volatility. If you would invest 993.00 in MSAD INSURANCE on August 27, 2024 and sell it today you would earn a total of 1,167 from holding MSAD INSURANCE or generate 117.52% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Carmat SA vs. MSAD INSURANCE
Performance |
| Timeline |
| Carmat SA |
| MSAD INSURANCE |
Carmat SA and MSAD INSURANCE Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Carmat SA and MSAD INSURANCE
The main advantage of trading using opposite Carmat SA and MSAD INSURANCE positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Carmat SA position performs unexpectedly, MSAD INSURANCE 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 MSAD INSURANCE will offset losses from the drop in MSAD INSURANCE's long position.| Carmat SA vs. American Eagle Outfitters | Carmat SA vs. Computer And Technologies | Carmat SA vs. VARIOUS EATERIES LS | Carmat SA vs. FANDIFI TECHNOLOGY P |
| MSAD INSURANCE vs. Apple Inc | MSAD INSURANCE vs. Apple Inc | MSAD INSURANCE vs. Apple Inc | MSAD INSURANCE vs. Microsoft |
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 Odds Of Bankruptcy module to get analysis of equity chance of financial distress in the next 2 years.
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