Correlation Between Fagron NV and Belysse Group
Can any of the company-specific risk be diversified away by investing in both Fagron NV and Belysse Group 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 Fagron NV and Belysse Group into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Fagron NV and Belysse Group NV, you can compare the effects of market volatilities on Fagron NV and Belysse Group 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 Fagron NV with a short position of Belysse Group. Check out your portfolio center. Please also check ongoing floating volatility patterns of Fagron NV and Belysse Group.
Diversification Opportunities for Fagron NV and Belysse Group
0.1 | Correlation Coefficient |
Average diversification
The 3 months correlation between Fagron and Belysse is 0.1. Overlapping area represents the amount of risk that can be diversified away by holding Fagron NV and Belysse Group NV in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Belysse Group NV and Fagron 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 Fagron NV are associated (or correlated) with Belysse Group. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Belysse Group NV has no effect on the direction of Fagron NV i.e., Fagron NV and Belysse Group go up and down completely randomly.
Pair Corralation between Fagron NV and Belysse Group
Assuming the 90 days trading horizon Fagron NV is expected to generate 0.35 times more return on investment than Belysse Group. However, Fagron NV is 2.89 times less risky than Belysse Group. It trades about 0.06 of its potential returns per unit of risk. Belysse Group NV is currently generating about -0.01 per unit of risk. If you would invest 1,228 in Fagron NV on August 29, 2024 and sell it today you would earn a total of 634.00 from holding Fagron NV or generate 51.63% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 94.26% |
| Values | Daily Returns |
Fagron NV vs. Belysse Group NV
Performance |
| Timeline |
| Fagron NV |
| Belysse Group NV |
Fagron NV and Belysse Group Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Fagron NV and Belysse Group
The main advantage of trading using opposite Fagron NV and Belysse Group positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Fagron NV position performs unexpectedly, Belysse Group 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 Belysse Group will offset losses from the drop in Belysse Group's long position.| Fagron NV vs. Tessenderlo | Fagron NV vs. NV Bekaert SA | Fagron NV vs. Ontex Group NV | Fagron NV vs. Argen X |
| Belysse Group vs. Biocartis Group NV | Belysse Group vs. Celyad SA | Belysse Group vs. Argen X | Belysse Group vs. Exmar NV |
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 Balance Of Power module to check stock momentum by analyzing Balance Of Power indicator and other technical ratios.
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