Correlation Between Societe Generale and Compagnie Generale
Can any of the company-specific risk be diversified away by investing in both Societe Generale and Compagnie Generale 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 Societe Generale and Compagnie Generale into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Societe Generale SA and Compagnie Generale des, you can compare the effects of market volatilities on Societe Generale and Compagnie Generale 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 Societe Generale with a short position of Compagnie Generale. Check out your portfolio center. Please also check ongoing floating volatility patterns of Societe Generale and Compagnie Generale.
Diversification Opportunities for Societe Generale and Compagnie Generale
-0.86 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between Societe and Compagnie is -0.86. Overlapping area represents the amount of risk that can be diversified away by holding Societe Generale SA and Compagnie Generale des in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Compagnie Generale des and Societe Generale 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 Societe Generale SA are associated (or correlated) with Compagnie Generale. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Compagnie Generale des has no effect on the direction of Societe Generale i.e., Societe Generale and Compagnie Generale go up and down completely randomly.
Pair Corralation between Societe Generale and Compagnie Generale
Assuming the 90 days trading horizon Societe Generale is expected to generate 1.06 times less return on investment than Compagnie Generale. In addition to that, Societe Generale is 1.5 times more volatile than Compagnie Generale des. It trades about 0.03 of its total potential returns per unit of risk. Compagnie Generale des is currently generating about 0.04 per unit of volatility. If you would invest 2,654 in Compagnie Generale des on September 1, 2024 and sell it today you would earn a total of 421.00 from holding Compagnie Generale des or generate 15.86% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Societe Generale SA vs. Compagnie Generale des
Performance |
| Timeline |
| Societe Generale |
| Compagnie Generale des |
Societe Generale and Compagnie Generale Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Societe Generale and Compagnie Generale
The main advantage of trading using opposite Societe Generale and Compagnie Generale positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Societe Generale position performs unexpectedly, Compagnie Generale 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 Generale will offset losses from the drop in Compagnie Generale's long position.| Societe Generale vs. BNP Paribas SA | Societe Generale vs. Credit Agricole SA | Societe Generale vs. AXA SA | Societe Generale vs. Renault SA |
| Compagnie Generale vs. Compagnie de Saint Gobain | Compagnie Generale vs. Pernod Ricard SA | Compagnie Generale vs. Bouygues SA | Compagnie Generale vs. Vinci 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 Piotroski F Score module to get Piotroski F Score based on the binary analysis strategy of nine different fundamentals.
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