Correlation Between Essilor International and Sysmex Corp
Can any of the company-specific risk be diversified away by investing in both Essilor International and Sysmex Corp 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 Essilor International and Sysmex Corp into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Essilor International SA and Sysmex Corp, you can compare the effects of market volatilities on Essilor International and Sysmex Corp 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 Essilor International with a short position of Sysmex Corp. Check out your portfolio center. Please also check ongoing floating volatility patterns of Essilor International and Sysmex Corp.
Diversification Opportunities for Essilor International and Sysmex Corp
0.21 | Correlation Coefficient |
Modest diversification
The 3 months correlation between Essilor and Sysmex is 0.21. Overlapping area represents the amount of risk that can be diversified away by holding Essilor International SA and Sysmex Corp in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Sysmex Corp and Essilor International 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 Essilor International SA are associated (or correlated) with Sysmex Corp. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Sysmex Corp has no effect on the direction of Essilor International i.e., Essilor International and Sysmex Corp go up and down completely randomly.
Pair Corralation between Essilor International and Sysmex Corp
Assuming the 90 days horizon Essilor International is expected to generate 2.68 times less return on investment than Sysmex Corp. But when comparing it to its historical volatility, Essilor International SA is 1.49 times less risky than Sysmex Corp. It trades about 0.15 of its potential returns per unit of risk. Sysmex Corp is currently generating about 0.28 of returns per unit of risk over similar time horizon. If you would invest 1,857 in Sysmex Corp on August 28, 2024 and sell it today you would earn a total of 200.00 from holding Sysmex Corp or generate 10.77% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Essilor International SA vs. Sysmex Corp
Performance |
| Timeline |
| Essilor International |
| Sysmex Corp |
Essilor International and Sysmex Corp Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Essilor International and Sysmex Corp
The main advantage of trading using opposite Essilor International and Sysmex Corp positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Essilor International position performs unexpectedly, Sysmex Corp 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 Sysmex Corp will offset losses from the drop in Sysmex Corp's long position.| Essilor International vs. Sysmex Corp | Essilor International vs. Straumann Holding AG | Essilor International vs. Coloplast AS | Essilor International vs. EssilorLuxottica Socit anonyme |
| Sysmex Corp vs. Straumann Holding AG | Sysmex Corp vs. Coloplast AS | Sysmex Corp vs. Essilor International SA | Sysmex Corp vs. EssilorLuxottica Socit anonyme |
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 USA ETFs module to find actively traded Exchange Traded Funds (ETF) in USA.
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