Correlation Between BEBO Health and Veolia Environnement
Can any of the company-specific risk be diversified away by investing in both BEBO Health and Veolia Environnement 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 BEBO Health and Veolia Environnement into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between BEBO Health SA and Veolia Environnement VE, you can compare the effects of market volatilities on BEBO Health and Veolia Environnement 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 BEBO Health with a short position of Veolia Environnement. Check out your portfolio center. Please also check ongoing floating volatility patterns of BEBO Health and Veolia Environnement.
Diversification Opportunities for BEBO Health and Veolia Environnement
0.38 | Correlation Coefficient |
Weak diversification
The 3 months correlation between BEBO and Veolia is 0.38. Overlapping area represents the amount of risk that can be diversified away by holding BEBO Health SA and Veolia Environnement VE in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Veolia Environnement and BEBO Health 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 BEBO Health SA are associated (or correlated) with Veolia Environnement. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Veolia Environnement has no effect on the direction of BEBO Health i.e., BEBO Health and Veolia Environnement go up and down completely randomly.
Pair Corralation between BEBO Health and Veolia Environnement
Assuming the 90 days trading horizon BEBO Health SA is expected to under-perform the Veolia Environnement. In addition to that, BEBO Health is 1.93 times more volatile than Veolia Environnement VE. It trades about -0.09 of its total potential returns per unit of risk. Veolia Environnement VE is currently generating about 0.04 per unit of volatility. If you would invest 2,475 in Veolia Environnement VE on August 26, 2024 and sell it today you would earn a total of 309.00 from holding Veolia Environnement VE or generate 12.48% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
BEBO Health SA vs. Veolia Environnement VE
Performance |
| Timeline |
| BEBO Health SA |
| Veolia Environnement |
BEBO Health and Veolia Environnement Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with BEBO Health and Veolia Environnement
The main advantage of trading using opposite BEBO Health and Veolia Environnement positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if BEBO Health position performs unexpectedly, Veolia Environnement 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 Veolia Environnement will offset losses from the drop in Veolia Environnement's long position.| BEBO Health vs. Groupe Partouche SA | BEBO Health vs. Gevelot | BEBO Health vs. Plastiques du Val | BEBO Health vs. Trilogiq |
| Veolia Environnement vs. Vinci SA | Veolia Environnement vs. Compagnie de Saint Gobain | Veolia Environnement vs. Bouygues SA | Veolia Environnement vs. Engie SA |
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 Companies Directory module to evaluate performance of over 100,000 Stocks, Funds, and ETFs against different fundamentals.
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