Correlation Between Carmat SA and HAVILA SHIPPING
Can any of the company-specific risk be diversified away by investing in both Carmat SA and HAVILA SHIPPING 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 HAVILA SHIPPING into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Carmat SA and HAVILA SHIPPING, you can compare the effects of market volatilities on Carmat SA and HAVILA SHIPPING 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 HAVILA SHIPPING. Check out your portfolio center. Please also check ongoing floating volatility patterns of Carmat SA and HAVILA SHIPPING.
Diversification Opportunities for Carmat SA and HAVILA SHIPPING
0.64 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Carmat and HAVILA is 0.64. Overlapping area represents the amount of risk that can be diversified away by holding Carmat SA and HAVILA SHIPPING in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on HAVILA SHIPPING 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 HAVILA SHIPPING. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of HAVILA SHIPPING has no effect on the direction of Carmat SA i.e., Carmat SA and HAVILA SHIPPING go up and down completely randomly.
Pair Corralation between Carmat SA and HAVILA SHIPPING
Assuming the 90 days horizon Carmat SA is expected to under-perform the HAVILA SHIPPING. In addition to that, Carmat SA is 1.21 times more volatile than HAVILA SHIPPING. It trades about -0.05 of its total potential returns per unit of risk. HAVILA SHIPPING is currently generating about -0.04 per unit of volatility. If you would invest 114.00 in HAVILA SHIPPING on August 27, 2024 and sell it today you would lose (92.00) from holding HAVILA SHIPPING or give up 80.7% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Carmat SA vs. HAVILA SHIPPING
Performance |
| Timeline |
| Carmat SA |
| HAVILA SHIPPING |
Carmat SA and HAVILA SHIPPING Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Carmat SA and HAVILA SHIPPING
The main advantage of trading using opposite Carmat SA and HAVILA SHIPPING positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Carmat SA position performs unexpectedly, HAVILA SHIPPING 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 HAVILA SHIPPING will offset losses from the drop in HAVILA SHIPPING'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 |
| HAVILA SHIPPING vs. Apple Inc | HAVILA SHIPPING vs. Apple Inc | HAVILA SHIPPING vs. Apple Inc | HAVILA SHIPPING 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 Price Transformation module to use Price Transformation models to analyze the depth of different equity instruments across global markets.
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