Correlation Between Gaztransport Technigaz and Memscap Regpt
Can any of the company-specific risk be diversified away by investing in both Gaztransport Technigaz and Memscap Regpt 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 Gaztransport Technigaz and Memscap Regpt into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Gaztransport Technigaz SAS and Memscap Regpt, you can compare the effects of market volatilities on Gaztransport Technigaz and Memscap Regpt 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 Gaztransport Technigaz with a short position of Memscap Regpt. Check out your portfolio center. Please also check ongoing floating volatility patterns of Gaztransport Technigaz and Memscap Regpt.
Diversification Opportunities for Gaztransport Technigaz and Memscap Regpt
-0.48 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Gaztransport and Memscap is -0.48. Overlapping area represents the amount of risk that can be diversified away by holding Gaztransport Technigaz SAS and Memscap Regpt in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Memscap Regpt and Gaztransport Technigaz 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 Gaztransport Technigaz SAS are associated (or correlated) with Memscap Regpt. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Memscap Regpt has no effect on the direction of Gaztransport Technigaz i.e., Gaztransport Technigaz and Memscap Regpt go up and down completely randomly.
Pair Corralation between Gaztransport Technigaz and Memscap Regpt
Assuming the 90 days trading horizon Gaztransport Technigaz SAS is expected to generate 0.4 times more return on investment than Memscap Regpt. However, Gaztransport Technigaz SAS is 2.52 times less risky than Memscap Regpt. It trades about 0.21 of its potential returns per unit of risk. Memscap Regpt is currently generating about -0.22 per unit of risk. If you would invest 12,590 in Gaztransport Technigaz SAS on August 28, 2024 and sell it today you would earn a total of 1,350 from holding Gaztransport Technigaz SAS or generate 10.72% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Gaztransport Technigaz SAS vs. Memscap Regpt
Performance |
| Timeline |
| Gaztransport Technigaz |
| Memscap Regpt |
Gaztransport Technigaz and Memscap Regpt Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Gaztransport Technigaz and Memscap Regpt
The main advantage of trading using opposite Gaztransport Technigaz and Memscap Regpt positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Gaztransport Technigaz position performs unexpectedly, Memscap Regpt 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 Memscap Regpt will offset losses from the drop in Memscap Regpt's long position.| Gaztransport Technigaz vs. Rubis SCA | Gaztransport Technigaz vs. Teleperformance SE | Gaztransport Technigaz vs. Sartorius Stedim Biotech | Gaztransport Technigaz vs. Nexity |
| Memscap Regpt vs. Sartorius Stedim Biotech | Memscap Regpt vs. Lectra SA | Memscap Regpt vs. Teleperformance SE | Memscap Regpt vs. Trigano 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 Portfolio Manager module to state of the art Portfolio Manager to monitor and improve performance of your invested capital.
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