Correlation Between Groep Brussel and Celyad SA
Can any of the company-specific risk be diversified away by investing in both Groep Brussel and Celyad SA 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 Groep Brussel and Celyad SA into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Groep Brussel Lambert and Celyad SA, you can compare the effects of market volatilities on Groep Brussel and Celyad SA 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 Groep Brussel with a short position of Celyad SA. Check out your portfolio center. Please also check ongoing floating volatility patterns of Groep Brussel and Celyad SA.
Diversification Opportunities for Groep Brussel and Celyad SA
-0.8 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between Groep and Celyad is -0.8. Overlapping area represents the amount of risk that can be diversified away by holding Groep Brussel Lambert and Celyad SA in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Celyad SA and Groep Brussel 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 Groep Brussel Lambert are associated (or correlated) with Celyad SA. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Celyad SA has no effect on the direction of Groep Brussel i.e., Groep Brussel and Celyad SA go up and down completely randomly.
Pair Corralation between Groep Brussel and Celyad SA
Assuming the 90 days trading horizon Groep Brussel Lambert is expected to under-perform the Celyad SA. But the stock apears to be less risky and, when comparing its historical volatility, Groep Brussel Lambert is 14.79 times less risky than Celyad SA. The stock trades about -0.02 of its potential returns per unit of risk. The Celyad SA is currently generating about 0.05 of returns per unit of risk over similar time horizon. If you would invest 72.00 in Celyad SA on September 12, 2024 and sell it today you would lose (1.00) from holding Celyad SA or give up 1.39% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Groep Brussel Lambert vs. Celyad SA
Performance |
| Timeline |
| Groep Brussel Lambert |
| Celyad SA |
Groep Brussel and Celyad SA Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Groep Brussel and Celyad SA
The main advantage of trading using opposite Groep Brussel and Celyad SA positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Groep Brussel position performs unexpectedly, Celyad SA 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 Celyad SA will offset losses from the drop in Celyad SA's long position.| Groep Brussel vs. Ackermans Van Haaren | Groep Brussel vs. Sofina Socit Anonyme | Groep Brussel vs. ageas SANV | Groep Brussel vs. Solvay SA |
| Celyad SA vs. Retail Estates | Celyad SA vs. Vastned Retail Belgium | Celyad SA vs. Keyware Technologies NV | Celyad SA vs. Onward Medical 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 Money Flow Index module to determine momentum by analyzing Money Flow Index and other technical indicators.
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