Correlation Between JC Decaux and Grolleau SAS
Can any of the company-specific risk be diversified away by investing in both JC Decaux and Grolleau SAS 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 JC Decaux and Grolleau SAS into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between JC Decaux SA and Grolleau SAS, you can compare the effects of market volatilities on JC Decaux and Grolleau SAS 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 JC Decaux with a short position of Grolleau SAS. Check out your portfolio center. Please also check ongoing floating volatility patterns of JC Decaux and Grolleau SAS.
Diversification Opportunities for JC Decaux and Grolleau SAS
0.4 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between DEC and Grolleau is 0.4. Overlapping area represents the amount of risk that can be diversified away by holding JC Decaux SA and Grolleau SAS in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Grolleau SAS and JC Decaux 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 JC Decaux SA are associated (or correlated) with Grolleau SAS. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Grolleau SAS has no effect on the direction of JC Decaux i.e., JC Decaux and Grolleau SAS go up and down completely randomly.
Pair Corralation between JC Decaux and Grolleau SAS
Assuming the 90 days trading horizon JC Decaux SA is expected to generate 0.6 times more return on investment than Grolleau SAS. However, JC Decaux SA is 1.65 times less risky than Grolleau SAS. It trades about -0.15 of its potential returns per unit of risk. Grolleau SAS is currently generating about -0.09 per unit of risk. If you would invest 2,166 in JC Decaux SA on September 1, 2024 and sell it today you would lose (757.00) from holding JC Decaux SA or give up 34.95% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
JC Decaux SA vs. Grolleau SAS
Performance |
| Timeline |
| JC Decaux SA |
| Grolleau SAS |
JC Decaux and Grolleau SAS Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with JC Decaux and Grolleau SAS
The main advantage of trading using opposite JC Decaux and Grolleau SAS positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if JC Decaux position performs unexpectedly, Grolleau SAS 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 Grolleau SAS will offset losses from the drop in Grolleau SAS's long position.| JC Decaux vs. Publicis Groupe SA | JC Decaux vs. Lagardere SCA | JC Decaux vs. Sodexo SA | JC Decaux vs. Imerys SA |
| Grolleau SAS vs. Berkem Group SA | Grolleau SAS vs. Waga Energy SA | Grolleau SAS vs. Entech SE SAS | Grolleau SAS vs. Orapi 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 Dashboard module to portfolio dashboard that provides centralized access to all your investments.
Other Complementary Tools
| Latest Portfolios Quick portfolio dashboard that showcases your latest portfolios | |
| Portfolio Backtesting Avoid under-diversification and over-optimization by backtesting your portfolios | |
| Economic Indicators Top statistical indicators that provide insights into how an economy is performing | |
| Piotroski F Score Get Piotroski F Score based on the binary analysis strategy of nine different fundamentals | |
| Volatility Analysis Get historical volatility and risk analysis based on latest market data |