Correlation Between Maisons Du and Claranova
Can any of the company-specific risk be diversified away by investing in both Maisons Du and Claranova 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 Maisons Du and Claranova into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Maisons du Monde and Claranova SE, you can compare the effects of market volatilities on Maisons Du and Claranova 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 Maisons Du with a short position of Claranova. Check out your portfolio center. Please also check ongoing floating volatility patterns of Maisons Du and Claranova.
Diversification Opportunities for Maisons Du and Claranova
0.26 | Correlation Coefficient |
Modest diversification
The 3 months correlation between Maisons and Claranova is 0.26. Overlapping area represents the amount of risk that can be diversified away by holding Maisons du Monde and Claranova SE in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Claranova SE and Maisons Du 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 Maisons du Monde are associated (or correlated) with Claranova. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Claranova SE has no effect on the direction of Maisons Du i.e., Maisons Du and Claranova go up and down completely randomly.
Pair Corralation between Maisons Du and Claranova
Assuming the 90 days trading horizon Maisons du Monde is expected to under-perform the Claranova. In addition to that, Maisons Du is 1.35 times more volatile than Claranova SE. It trades about -0.16 of its total potential returns per unit of risk. Claranova SE is currently generating about -0.05 per unit of volatility. If you would invest 146.00 in Claranova SE on August 31, 2024 and sell it today you would lose (4.00) from holding Claranova SE or give up 2.74% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Maisons du Monde vs. Claranova SE
Performance |
| Timeline |
| Maisons du Monde |
| Claranova SE |
Maisons Du and Claranova Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Maisons Du and Claranova
The main advantage of trading using opposite Maisons Du and Claranova positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Maisons Du position performs unexpectedly, Claranova 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 Claranova will offset losses from the drop in Claranova's long position.| Maisons Du vs. Fnac Darty SA | Maisons Du vs. Trigano SA | Maisons Du vs. Elis SA | Maisons Du vs. Derichebourg |
| Claranova vs. Linedata Services SA | Claranova vs. Interparfums SA | Claranova vs. Esker SA | Claranova vs. Neurones |
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 Fundamental Analysis module to view fundamental data based on most recent published financial statements.
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