Correlation Between Exmar NV and Campine
Can any of the company-specific risk be diversified away by investing in both Exmar NV and Campine 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 Exmar NV and Campine into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Exmar NV and Campine, you can compare the effects of market volatilities on Exmar NV and Campine 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 Exmar NV with a short position of Campine. Check out your portfolio center. Please also check ongoing floating volatility patterns of Exmar NV and Campine.
Diversification Opportunities for Exmar NV and Campine
Poor diversification
The 3 months correlation between Exmar and Campine is 0.75. Overlapping area represents the amount of risk that can be diversified away by holding Exmar NV and Campine in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Campine and Exmar NV 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 Exmar NV are associated (or correlated) with Campine. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Campine has no effect on the direction of Exmar NV i.e., Exmar NV and Campine go up and down completely randomly.
Pair Corralation between Exmar NV and Campine
Assuming the 90 days trading horizon Exmar NV is expected to generate 1.32 times more return on investment than Campine. However, Exmar NV is 1.32 times more volatile than Campine. It trades about 0.09 of its potential returns per unit of risk. Campine is currently generating about 0.1 per unit of risk. If you would invest 401.00 in Exmar NV on November 27, 2024 and sell it today you would earn a total of 747.00 from holding Exmar NV or generate 186.28% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 96.61% |
| Values | Daily Returns |
Exmar NV vs. Campine
Performance |
| Timeline |
| Exmar NV |
| Campine |
Exmar NV and Campine Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Exmar NV and Campine
The main advantage of trading using opposite Exmar NV and Campine positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Exmar NV position performs unexpectedly, Campine 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 Campine will offset losses from the drop in Campine's long position.| Exmar NV vs. EVS Broadcast Equipment | Exmar NV vs. NV Bekaert SA | Exmar NV vs. Tessenderlo | Exmar NV vs. Melexis NV |
| Campine vs. Miko NV | Campine vs. Tessenderlo | Campine vs. Van de Velde | Campine vs. EVS Broadcast Equipment |
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 Stock Tickers module to use high-impact, comprehensive, and customizable stock tickers that can be easily integrated to any websites.
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