Correlation Between Compagnie Générale and Aeye
Can any of the company-specific risk be diversified away by investing in both Compagnie Générale and Aeye 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 Compagnie Générale and Aeye into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Compagnie Gnrale des and Aeye Inc, you can compare the effects of market volatilities on Compagnie Générale and Aeye 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 Compagnie Générale with a short position of Aeye. Check out your portfolio center. Please also check ongoing floating volatility patterns of Compagnie Générale and Aeye.
Diversification Opportunities for Compagnie Générale and Aeye
0.22 | Correlation Coefficient |
Modest diversification
The 3 months correlation between Compagnie and Aeye is 0.22. Overlapping area represents the amount of risk that can be diversified away by holding Compagnie Gnrale des and Aeye Inc in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Aeye Inc and Compagnie Générale 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 Compagnie Gnrale des are associated (or correlated) with Aeye. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Aeye Inc has no effect on the direction of Compagnie Générale i.e., Compagnie Générale and Aeye go up and down completely randomly.
Pair Corralation between Compagnie Générale and Aeye
Assuming the 90 days horizon Compagnie Générale is expected to generate 14.33 times less return on investment than Aeye. But when comparing it to its historical volatility, Compagnie Gnrale des is 1.71 times less risky than Aeye. It trades about 0.01 of its potential returns per unit of risk. Aeye Inc is currently generating about 0.07 of returns per unit of risk over similar time horizon. If you would invest 108.00 in Aeye Inc on September 2, 2024 and sell it today you would earn a total of 5.00 from holding Aeye Inc or generate 4.63% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Compagnie Gnrale des vs. Aeye Inc
Performance |
| Timeline |
| Compagnie Gnrale des |
| Aeye Inc |
Compagnie Générale and Aeye Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Compagnie Générale and Aeye
The main advantage of trading using opposite Compagnie Générale and Aeye positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Compagnie Générale position performs unexpectedly, Aeye 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 Aeye will offset losses from the drop in Aeye's long position.| Compagnie Générale vs. Continental AG PK | Compagnie Générale vs. Bridgestone Corp ADR | Compagnie Générale vs. Continental Aktiengesellschaft | Compagnie Générale vs. Douglas Dynamics |
| Aeye vs. Innoviz Technologies | Aeye vs. Hesai Group American | Aeye vs. Luminar Technologies | Aeye vs. Mobileye Global Class |
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 ETF Categories module to list of ETF categories grouped based on various criteria, such as the investment strategy or type of investments.
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