Correlation Between Compagnie Plastic and FORWARD AIR
Can any of the company-specific risk be diversified away by investing in both Compagnie Plastic and FORWARD AIR 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 Compagnie Plastic and FORWARD AIR into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Compagnie Plastic Omnium and FORWARD AIR P, you can compare the effects of market volatilities on Compagnie Plastic and FORWARD AIR 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 Compagnie Plastic with a short position of FORWARD AIR. Check out your portfolio center. Please also check ongoing floating volatility patterns of Compagnie Plastic and FORWARD AIR.
Diversification Opportunities for Compagnie Plastic and FORWARD AIR
-0.49 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Compagnie and FORWARD is -0.49. Overlapping area represents the amount of risk that can be diversified away by holding Compagnie Plastic Omnium and FORWARD AIR P in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on FORWARD AIR P and Compagnie Plastic 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 Compagnie Plastic Omnium are associated (or correlated) with FORWARD AIR. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of FORWARD AIR P has no effect on the direction of Compagnie Plastic i.e., Compagnie Plastic and FORWARD AIR go up and down completely randomly.
Pair Corralation between Compagnie Plastic and FORWARD AIR
Assuming the 90 days horizon Compagnie Plastic is expected to generate 2.12 times less return on investment than FORWARD AIR. But when comparing it to its historical volatility, Compagnie Plastic Omnium is 1.23 times less risky than FORWARD AIR. It trades about 0.16 of its potential returns per unit of risk. FORWARD AIR P is currently generating about 0.27 of returns per unit of risk over similar time horizon. If you would invest 2,880 in FORWARD AIR P on October 25, 2024 and sell it today you would earn a total of 420.00 from holding FORWARD AIR P or generate 14.58% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Compagnie Plastic Omnium vs. FORWARD AIR P
Performance |
| Timeline |
| Compagnie Plastic Omnium |
| FORWARD AIR P |
Compagnie Plastic and FORWARD AIR Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Compagnie Plastic and FORWARD AIR
The main advantage of trading using opposite Compagnie Plastic and FORWARD AIR positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Compagnie Plastic position performs unexpectedly, FORWARD AIR 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 FORWARD AIR will offset losses from the drop in FORWARD AIR's long position.| Compagnie Plastic vs. Dno ASA | Compagnie Plastic vs. DENSO P ADR | Compagnie Plastic vs. Aptiv PLC | Compagnie Plastic vs. Bridgestone |
| FORWARD AIR vs. Hitachi Construction Machinery | FORWARD AIR vs. Granite Construction | FORWARD AIR vs. Daito Trust Construction | FORWARD AIR vs. Compagnie Plastic Omnium |
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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