Correlation Between Getlink SE and Compagnie
Can any of the company-specific risk be diversified away by investing in both Getlink SE and Compagnie 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 Getlink SE and Compagnie into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Getlink SE and Compagnie du Cambodge, you can compare the effects of market volatilities on Getlink SE and Compagnie 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 Getlink SE with a short position of Compagnie. Check out your portfolio center. Please also check ongoing floating volatility patterns of Getlink SE and Compagnie.
Diversification Opportunities for Getlink SE and Compagnie
0.37 | Correlation Coefficient |
Weak diversification
The 3 months correlation between Getlink and Compagnie is 0.37. Overlapping area represents the amount of risk that can be diversified away by holding Getlink SE and Compagnie du Cambodge in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Compagnie du Cambodge and Getlink SE 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 Getlink SE are associated (or correlated) with Compagnie. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Compagnie du Cambodge has no effect on the direction of Getlink SE i.e., Getlink SE and Compagnie go up and down completely randomly.
Pair Corralation between Getlink SE and Compagnie
Assuming the 90 days trading horizon Getlink SE is expected to generate 1.27 times more return on investment than Compagnie. However, Getlink SE is 1.27 times more volatile than Compagnie du Cambodge. It trades about -0.03 of its potential returns per unit of risk. Compagnie du Cambodge is currently generating about -0.22 per unit of risk. If you would invest 1,563 in Getlink SE on August 30, 2024 and sell it today you would lose (10.00) from holding Getlink SE or give up 0.64% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 95.65% |
| Values | Daily Returns |
Getlink SE vs. Compagnie du Cambodge
Performance |
| Timeline |
| Getlink SE |
| Compagnie du Cambodge |
Getlink SE and Compagnie Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Getlink SE and Compagnie
The main advantage of trading using opposite Getlink SE and Compagnie positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Getlink SE position performs unexpectedly, Compagnie 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 Compagnie will offset losses from the drop in Compagnie's long position.| Getlink SE vs. Aeroports de Paris | Getlink SE vs. Eiffage SA | Getlink SE vs. Bureau Veritas SA | Getlink SE vs. Edenred SA |
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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 Screener module to find equities using a custom stock filter or screen asymmetry in trading patterns, price, volume, or investment outlook..
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