Correlation Between Jacquet Metal and Edenred SA
Can any of the company-specific risk be diversified away by investing in both Jacquet Metal and Edenred 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 Jacquet Metal and Edenred SA into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Jacquet Metal Service and Edenred SA, you can compare the effects of market volatilities on Jacquet Metal and Edenred 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 Jacquet Metal with a short position of Edenred SA. Check out your portfolio center. Please also check ongoing floating volatility patterns of Jacquet Metal and Edenred SA.
Diversification Opportunities for Jacquet Metal and Edenred SA
-0.48 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Jacquet and Edenred is -0.48. Overlapping area represents the amount of risk that can be diversified away by holding Jacquet Metal Service and Edenred SA in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Edenred SA and Jacquet Metal 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 Jacquet Metal Service are associated (or correlated) with Edenred SA. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Edenred SA has no effect on the direction of Jacquet Metal i.e., Jacquet Metal and Edenred SA go up and down completely randomly.
Pair Corralation between Jacquet Metal and Edenred SA
Assuming the 90 days trading horizon Jacquet Metal Service is expected to under-perform the Edenred SA. But the stock apears to be less risky and, when comparing its historical volatility, Jacquet Metal Service is 1.1 times less risky than Edenred SA. The stock trades about -0.04 of its potential returns per unit of risk. The Edenred SA is currently generating about 0.15 of returns per unit of risk over similar time horizon. If you would invest 2,979 in Edenred SA on September 3, 2024 and sell it today you would earn a total of 151.00 from holding Edenred SA or generate 5.07% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Jacquet Metal Service vs. Edenred SA
Performance |
| Timeline |
| Jacquet Metal Service |
| Edenred SA |
Jacquet Metal and Edenred SA Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Jacquet Metal and Edenred SA
The main advantage of trading using opposite Jacquet Metal and Edenred SA positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Jacquet Metal position performs unexpectedly, Edenred 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 Edenred SA will offset losses from the drop in Edenred SA's long position.| Jacquet Metal vs. Derichebourg | Jacquet Metal vs. Mersen SA | Jacquet Metal vs. Trigano SA | Jacquet Metal vs. Chargeurs SA |
| Edenred SA vs. Derichebourg | Edenred SA vs. Mersen SA | Edenred SA vs. Trigano SA | Edenred SA vs. Chargeurs 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 Equity Valuation module to check real value of public entities based on technical and fundamental data.
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