Correlation Between Hydrogene and Icape Holding
Can any of the company-specific risk be diversified away by investing in both Hydrogene and Icape Holding 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 Hydrogene and Icape Holding into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Hydrogene De France and Icape Holding, you can compare the effects of market volatilities on Hydrogene and Icape Holding 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 Hydrogene with a short position of Icape Holding. Check out your portfolio center. Please also check ongoing floating volatility patterns of Hydrogene and Icape Holding.
Diversification Opportunities for Hydrogene and Icape Holding
0.93 | Correlation Coefficient |
Almost no diversification
The 3 months correlation between Hydrogene and Icape is 0.93. Overlapping area represents the amount of risk that can be diversified away by holding Hydrogene De France and Icape Holding in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Icape Holding and Hydrogene 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 Hydrogene De France are associated (or correlated) with Icape Holding. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Icape Holding has no effect on the direction of Hydrogene i.e., Hydrogene and Icape Holding go up and down completely randomly.
Pair Corralation between Hydrogene and Icape Holding
Assuming the 90 days trading horizon Hydrogene De France is expected to under-perform the Icape Holding. In addition to that, Hydrogene is 1.18 times more volatile than Icape Holding. It trades about -0.46 of its total potential returns per unit of risk. Icape Holding is currently generating about -0.07 per unit of volatility. If you would invest 780.00 in Icape Holding on August 28, 2024 and sell it today you would lose (32.00) from holding Icape Holding or give up 4.1% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Hydrogene De France vs. Icape Holding
Performance |
| Timeline |
| Hydrogene De France |
| Icape Holding |
Hydrogene and Icape Holding Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Hydrogene and Icape Holding
The main advantage of trading using opposite Hydrogene and Icape Holding positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Hydrogene position performs unexpectedly, Icape Holding 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 Icape Holding will offset losses from the drop in Icape Holding's long position.| Hydrogene vs. Lexibook Linguistic Electronic | Hydrogene vs. Manitou BF SA | Hydrogene vs. Ossiam Minimum Variance | Hydrogene vs. Granite 3x LVMH |
| Icape Holding vs. LVMH Mot Hennessy | Icape Holding vs. LOreal SA | Icape Holding vs. Hermes International SCA | Icape Holding vs. Manitou BF 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 USA ETFs module to find actively traded Exchange Traded Funds (ETF) in USA.
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