Correlation Between Legrand SA and Worldline
Can any of the company-specific risk be diversified away by investing in both Legrand SA and Worldline 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 Legrand SA and Worldline into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Legrand SA and Worldline SA, you can compare the effects of market volatilities on Legrand SA and Worldline 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 Legrand SA with a short position of Worldline. Check out your portfolio center. Please also check ongoing floating volatility patterns of Legrand SA and Worldline.
Diversification Opportunities for Legrand SA and Worldline
-0.47 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Legrand and Worldline is -0.47. Overlapping area represents the amount of risk that can be diversified away by holding Legrand SA and Worldline SA in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Worldline SA and Legrand 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 Legrand SA are associated (or correlated) with Worldline. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Worldline SA has no effect on the direction of Legrand SA i.e., Legrand SA and Worldline go up and down completely randomly.
Pair Corralation between Legrand SA and Worldline
Assuming the 90 days horizon Legrand SA is expected to generate 1.13 times less return on investment than Worldline. But when comparing it to its historical volatility, Legrand SA is 1.83 times less risky than Worldline. It trades about 0.09 of its potential returns per unit of risk. Worldline SA is currently generating about 0.05 of returns per unit of risk over similar time horizon. If you would invest 828.00 in Worldline SA on November 5, 2024 and sell it today you would earn a total of 24.00 from holding Worldline SA or generate 2.9% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Legrand SA vs. Worldline SA
Performance |
| Timeline |
| Legrand SA |
| Worldline SA |
Legrand SA and Worldline Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Legrand SA and Worldline
The main advantage of trading using opposite Legrand SA and Worldline positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Legrand SA position performs unexpectedly, Worldline 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 Worldline will offset losses from the drop in Worldline's long position.| Legrand SA vs. Schneider Electric SE | Legrand SA vs. Publicis Groupe SA | Legrand SA vs. Pernod Ricard SA | Legrand SA vs. Compagnie Generale des |
| Worldline vs. Atos SE | Worldline vs. Teleperformance SE | Worldline vs. Dassault Systemes SE | Worldline vs. Capgemini SE |
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 Sign In To Macroaxis module to sign in to explore Macroaxis' wealth optimization platform and fintech modules.
Other Complementary Tools
| Global Correlations Find global opportunities by holding instruments from different markets | |
| Equity Forecasting Use basic forecasting models to generate price predictions and determine price momentum | |
| Portfolio Diagnostics Use generated alerts and portfolio events aggregator to diagnose current holdings | |
| Sectors List of equity sectors categorizing publicly traded companies based on their primary business activities | |
| Companies Directory Evaluate performance of over 100,000 Stocks, Funds, and ETFs against different fundamentals |