Correlation Between Malteries Franco and Esso SAF
Can any of the company-specific risk be diversified away by investing in both Malteries Franco and Esso SAF 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 Malteries Franco and Esso SAF into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Malteries Franco Belges Socit and Esso SAF, you can compare the effects of market volatilities on Malteries Franco and Esso SAF 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 Malteries Franco with a short position of Esso SAF. Check out your portfolio center. Please also check ongoing floating volatility patterns of Malteries Franco and Esso SAF.
Diversification Opportunities for Malteries Franco and Esso SAF
-0.81 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between Malteries and Esso is -0.81. Overlapping area represents the amount of risk that can be diversified away by holding Malteries Franco Belges Socit and Esso SAF in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Esso SAF and Malteries Franco 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 Malteries Franco Belges Socit are associated (or correlated) with Esso SAF. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Esso SAF has no effect on the direction of Malteries Franco i.e., Malteries Franco and Esso SAF go up and down completely randomly.
Pair Corralation between Malteries Franco and Esso SAF
Assuming the 90 days trading horizon Malteries Franco Belges Socit is expected to generate 0.44 times more return on investment than Esso SAF. However, Malteries Franco Belges Socit is 2.29 times less risky than Esso SAF. It trades about 0.08 of its potential returns per unit of risk. Esso SAF is currently generating about -0.12 per unit of risk. If you would invest 64,000 in Malteries Franco Belges Socit on September 5, 2024 and sell it today you would earn a total of 9,000 from holding Malteries Franco Belges Socit or generate 14.06% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Malteries Franco Belges Socit vs. Esso SAF
Performance |
| Timeline |
| Malteries Franco Belges |
| Esso SAF |
Malteries Franco and Esso SAF Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Malteries Franco and Esso SAF
The main advantage of trading using opposite Malteries Franco and Esso SAF positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Malteries Franco position performs unexpectedly, Esso SAF 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 Esso SAF will offset losses from the drop in Esso SAF's long position.| Malteries Franco vs. Grard Perrier Industrie | Malteries Franco vs. Robertet SA | Malteries Franco vs. Thermador Groupe SA | Malteries Franco vs. Piscines Desjoyaux SA |
| Esso SAF vs. Etablissements Maurel et | Esso SAF vs. Eramet SA | Esso SAF vs. Socit BIC SA | Esso SAF vs. TotalEnergies EP Gabon |
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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