Correlation Between Ecclesiastical Insurance and Gaztransport
Can any of the company-specific risk be diversified away by investing in both Ecclesiastical Insurance and Gaztransport 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 Ecclesiastical Insurance and Gaztransport into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Ecclesiastical Insurance Office and Gaztransport et Technigaz, you can compare the effects of market volatilities on Ecclesiastical Insurance and Gaztransport 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 Ecclesiastical Insurance with a short position of Gaztransport. Check out your portfolio center. Please also check ongoing floating volatility patterns of Ecclesiastical Insurance and Gaztransport.
Diversification Opportunities for Ecclesiastical Insurance and Gaztransport
-0.33 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Ecclesiastical and Gaztransport is -0.33. Overlapping area represents the amount of risk that can be diversified away by holding Ecclesiastical Insurance Offic and Gaztransport et Technigaz in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Gaztransport et Technigaz and Ecclesiastical Insurance 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 Ecclesiastical Insurance Office are associated (or correlated) with Gaztransport. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Gaztransport et Technigaz has no effect on the direction of Ecclesiastical Insurance i.e., Ecclesiastical Insurance and Gaztransport go up and down completely randomly.
Pair Corralation between Ecclesiastical Insurance and Gaztransport
Assuming the 90 days trading horizon Ecclesiastical Insurance Office is expected to generate 0.35 times more return on investment than Gaztransport. However, Ecclesiastical Insurance Office is 2.83 times less risky than Gaztransport. It trades about 0.2 of its potential returns per unit of risk. Gaztransport et Technigaz is currently generating about 0.03 per unit of risk. If you would invest 13,950 in Ecclesiastical Insurance Office on January 30, 2025 and sell it today you would earn a total of 500.00 from holding Ecclesiastical Insurance Office or generate 3.58% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Ecclesiastical Insurance Offic vs. Gaztransport et Technigaz
Performance |
| Timeline |
| Ecclesiastical Insurance |
| Gaztransport et Technigaz |
Ecclesiastical Insurance and Gaztransport Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Ecclesiastical Insurance and Gaztransport
The main advantage of trading using opposite Ecclesiastical Insurance and Gaztransport positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Ecclesiastical Insurance position performs unexpectedly, Gaztransport 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 Gaztransport will offset losses from the drop in Gaztransport's long position.| Ecclesiastical Insurance vs. Scandinavian Tobacco Group | Ecclesiastical Insurance vs. Odfjell Drilling | Ecclesiastical Insurance vs. Scandic Hotels Group | Ecclesiastical Insurance vs. bet at home AG |
| Gaztransport vs. Endeavour Mining Corp | Gaztransport vs. Silvercorp Metals | Gaztransport vs. Coeur Mining | Gaztransport vs. musicMagpie PLC |
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 Correlation Analysis module to reduce portfolio risk simply by holding instruments which are not perfectly correlated.
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