Correlation Between Financiere Marjos and Lanson BCC
Can any of the company-specific risk be diversified away by investing in both Financiere Marjos and Lanson BCC 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 Financiere Marjos and Lanson BCC into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Financiere Marjos SA and Lanson BCC SA, you can compare the effects of market volatilities on Financiere Marjos and Lanson BCC 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 Financiere Marjos with a short position of Lanson BCC. Check out your portfolio center. Please also check ongoing floating volatility patterns of Financiere Marjos and Lanson BCC.
Diversification Opportunities for Financiere Marjos and Lanson BCC
-0.57 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between Financiere and Lanson is -0.57. Overlapping area represents the amount of risk that can be diversified away by holding Financiere Marjos SA and Lanson BCC SA in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Lanson BCC SA and Financiere Marjos 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 Financiere Marjos SA are associated (or correlated) with Lanson BCC. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Lanson BCC SA has no effect on the direction of Financiere Marjos i.e., Financiere Marjos and Lanson BCC go up and down completely randomly.
Pair Corralation between Financiere Marjos and Lanson BCC
Assuming the 90 days trading horizon Financiere Marjos SA is expected to generate 5.16 times more return on investment than Lanson BCC. However, Financiere Marjos is 5.16 times more volatile than Lanson BCC SA. It trades about 0.04 of its potential returns per unit of risk. Lanson BCC SA is currently generating about 0.03 per unit of risk. If you would invest 10.00 in Financiere Marjos SA on August 30, 2024 and sell it today you would earn a total of 0.00 from holding Financiere Marjos SA or generate 0.0% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 96.23% |
| Values | Daily Returns |
Financiere Marjos SA vs. Lanson BCC SA
Performance |
| Timeline |
| Financiere Marjos |
| Lanson BCC SA |
Financiere Marjos and Lanson BCC Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Financiere Marjos and Lanson BCC
The main advantage of trading using opposite Financiere Marjos and Lanson BCC positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Financiere Marjos position performs unexpectedly, Lanson BCC 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 Lanson BCC will offset losses from the drop in Lanson BCC's long position.| Financiere Marjos vs. Nexity | Financiere Marjos vs. Icade SA | Financiere Marjos vs. Rubis SCA | Financiere Marjos vs. SCOR SE |
| Lanson BCC vs. Fiducial Office Solutions | Lanson BCC vs. Hoteles Bestprice SA | Lanson BCC vs. Invibes Advertising NV | Lanson BCC vs. X Fab Silicon |
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 Bollinger Bands module to use Bollinger Bands indicator to analyze target price for a given investing horizon.
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