Correlation Between Maisons Du and Television Francaise
Can any of the company-specific risk be diversified away by investing in both Maisons Du and Television Francaise 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 Television Francaise 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 Television Francaise 1, you can compare the effects of market volatilities on Maisons Du and Television Francaise 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 Television Francaise. Check out your portfolio center. Please also check ongoing floating volatility patterns of Maisons Du and Television Francaise.
Diversification Opportunities for Maisons Du and Television Francaise
0.5 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Maisons and Television is 0.5. Overlapping area represents the amount of risk that can be diversified away by holding Maisons du Monde and Television Francaise 1 in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Television Francaise 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 Television Francaise. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Television Francaise has no effect on the direction of Maisons Du i.e., Maisons Du and Television Francaise go up and down completely randomly.
Pair Corralation between Maisons Du and Television Francaise
Assuming the 90 days trading horizon Maisons du Monde is expected to under-perform the Television Francaise. In addition to that, Maisons Du is 1.91 times more volatile than Television Francaise 1. It trades about -0.06 of its total potential returns per unit of risk. Television Francaise 1 is currently generating about 0.03 per unit of volatility. If you would invest 629.00 in Television Francaise 1 on August 30, 2024 and sell it today you would earn a total of 100.00 from holding Television Francaise 1 or generate 15.9% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Maisons du Monde vs. Television Francaise 1
Performance |
| Timeline |
| Maisons du Monde |
| Television Francaise |
Maisons Du and Television Francaise Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Maisons Du and Television Francaise
The main advantage of trading using opposite Maisons Du and Television Francaise positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Maisons Du position performs unexpectedly, Television Francaise 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 Television Francaise will offset losses from the drop in Television Francaise's long position.| Maisons Du vs. Fnac Darty SA | Maisons Du vs. Trigano SA | Maisons Du vs. Elis SA | Maisons Du vs. Derichebourg |
| Television Francaise vs. Nexity | Television Francaise vs. Lagardere SCA | Television Francaise vs. Eutelsat Communications SA | Television Francaise vs. SCOR 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 Idea Breakdown module to analyze constituents of all Macroaxis ideas. Macroaxis investment ideas are predefined, sector-focused investing themes.
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