Correlation Between Lombard Et and Credit Agricole
Can any of the company-specific risk be diversified away by investing in both Lombard Et and Credit Agricole 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 Lombard Et and Credit Agricole into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Lombard et Medot and Credit Agricole SA, you can compare the effects of market volatilities on Lombard Et and Credit Agricole 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 Lombard Et with a short position of Credit Agricole. Check out your portfolio center. Please also check ongoing floating volatility patterns of Lombard Et and Credit Agricole.
Diversification Opportunities for Lombard Et and Credit Agricole
0.22 | Correlation Coefficient |
Modest diversification
The 3 months correlation between Lombard and Credit is 0.22. Overlapping area represents the amount of risk that can be diversified away by holding Lombard et Medot and Credit Agricole SA in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Credit Agricole SA and Lombard Et 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 Lombard et Medot are associated (or correlated) with Credit Agricole. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Credit Agricole SA has no effect on the direction of Lombard Et i.e., Lombard Et and Credit Agricole go up and down completely randomly.
Pair Corralation between Lombard Et and Credit Agricole
Assuming the 90 days trading horizon Lombard et Medot is expected to generate 4.23 times more return on investment than Credit Agricole. However, Lombard Et is 4.23 times more volatile than Credit Agricole SA. It trades about 0.21 of its potential returns per unit of risk. Credit Agricole SA is currently generating about 0.52 per unit of risk. If you would invest 1,470 in Lombard et Medot on October 26, 2024 and sell it today you would earn a total of 200.00 from holding Lombard et Medot or generate 13.61% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 95.0% |
| Values | Daily Returns |
Lombard et Medot vs. Credit Agricole SA
Performance |
| Timeline |
| Lombard et Medot |
| Credit Agricole SA |
Lombard Et and Credit Agricole Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Lombard Et and Credit Agricole
The main advantage of trading using opposite Lombard Et and Credit Agricole positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Lombard Et position performs unexpectedly, Credit Agricole 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 Credit Agricole will offset losses from the drop in Credit Agricole's long position.| Lombard Et vs. Credit Agricole SA | Lombard Et vs. Invibes Advertising NV | Lombard Et vs. Air France KLM SA | Lombard Et vs. Linedata Services SA |
| Credit Agricole vs. Societe Generale SA | Credit Agricole vs. BNP Paribas SA | Credit Agricole vs. AXA SA | Credit Agricole vs. Orange 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 Positions Ratings module to determine portfolio positions ratings based on digital equity recommendations. Macroaxis instant position ratings are based on combination of fundamental analysis and risk-adjusted market performance.
Other Complementary Tools
| Correlation Analysis Reduce portfolio risk simply by holding instruments which are not perfectly correlated | |
| Global Markets Map Get a quick overview of global market snapshot using zoomable world map. Drill down to check world indexes | |
| Risk-Return Analysis View associations between returns expected from investment and the risk you assume | |
| USA ETFs Find actively traded Exchange Traded Funds (ETF) in USA | |
| Price Transformation Use Price Transformation models to analyze the depth of different equity instruments across global markets |