Correlation Between Financiere Marjos and Les Htels
Can any of the company-specific risk be diversified away by investing in both Financiere Marjos and Les Htels 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 Les Htels 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 Les Htels de, you can compare the effects of market volatilities on Financiere Marjos and Les Htels 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 Les Htels. Check out your portfolio center. Please also check ongoing floating volatility patterns of Financiere Marjos and Les Htels.
Diversification Opportunities for Financiere Marjos and Les Htels
-0.66 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between Financiere and Les is -0.66. Overlapping area represents the amount of risk that can be diversified away by holding Financiere Marjos SA and Les Htels de in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Les Htels de 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 Les Htels. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Les Htels de has no effect on the direction of Financiere Marjos i.e., Financiere Marjos and Les Htels go up and down completely randomly.
Pair Corralation between Financiere Marjos and Les Htels
Assuming the 90 days trading horizon Financiere Marjos SA is expected to under-perform the Les Htels. In addition to that, Financiere Marjos is 1.43 times more volatile than Les Htels de. It trades about -0.15 of its total potential returns per unit of risk. Les Htels de is currently generating about 0.24 per unit of volatility. If you would invest 116.00 in Les Htels de on November 2, 2024 and sell it today you would earn a total of 41.00 from holding Les Htels de or generate 35.34% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Financiere Marjos SA vs. Les Htels de
Performance |
| Timeline |
| Financiere Marjos |
| Les Htels de |
Financiere Marjos and Les Htels Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Financiere Marjos and Les Htels
The main advantage of trading using opposite Financiere Marjos and Les Htels positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Financiere Marjos position performs unexpectedly, Les Htels 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 Les Htels will offset losses from the drop in Les Htels' long position.| Financiere Marjos vs. Fiducial Office Solutions | Financiere Marjos vs. Foncire Euris SA | Financiere Marjos vs. Bernard Loisea | Financiere Marjos vs. Coheris SA |
| Les Htels vs. Accor S A | Les Htels vs. Pierre et Vacances | Les Htels vs. Ferm Casino Mun | Les Htels vs. Hotel Majestic Cannes |
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 Technical Analysis module to check basic technical indicators and analysis based on most latest market data.
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