Correlation Between Gecina SA and Artea SA
Can any of the company-specific risk be diversified away by investing in both Gecina SA and Artea 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 Gecina SA and Artea SA into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Gecina SA and Artea SA, you can compare the effects of market volatilities on Gecina SA and Artea 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 Gecina SA with a short position of Artea SA. Check out your portfolio center. Please also check ongoing floating volatility patterns of Gecina SA and Artea SA.
Diversification Opportunities for Gecina SA and Artea SA
Very weak diversification
The 3 months correlation between Gecina and Artea is 0.58. Overlapping area represents the amount of risk that can be diversified away by holding Gecina SA and Artea SA in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Artea SA and Gecina SA 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 Gecina SA are associated (or correlated) with Artea SA. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Artea SA has no effect on the direction of Gecina SA i.e., Gecina SA and Artea SA go up and down completely randomly.
Pair Corralation between Gecina SA and Artea SA
Assuming the 90 days trading horizon Gecina SA is expected to generate 0.54 times more return on investment than Artea SA. However, Gecina SA is 1.86 times less risky than Artea SA. It trades about -0.18 of its potential returns per unit of risk. Artea SA is currently generating about -0.1 per unit of risk. If you would invest 9,470 in Gecina SA on September 13, 2024 and sell it today you would lose (430.00) from holding Gecina SA or give up 4.54% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Gecina SA vs. Artea SA
Performance |
| Timeline |
| Gecina SA |
| Artea SA |
Gecina SA and Artea SA Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Gecina SA and Artea SA
The main advantage of trading using opposite Gecina SA and Artea SA positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Gecina SA position performs unexpectedly, Artea 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 Artea SA will offset losses from the drop in Artea SA's long position.The idea behind Gecina SA and Artea SA pairs trading is to make the combined position market-neutral, meaning the overall market's direction will not affect its win or loss (or potential downside or upside). This can be achieved by designing a pairs trade with two highly correlated stocks or equities that operate in a similar space or sector, making it possible to obtain profits through simple and relatively low-risk investment.| Artea SA vs. Bourse Direct SA | Artea SA vs. CBO Territoria SA | Artea SA vs. Altareit | Artea SA vs. Courtois SA |
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 Transaction History module to view history of all your transactions and understand their impact on performance.
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