Correlation Between CFM Indosuez and Lhyfe SA
Can any of the company-specific risk be diversified away by investing in both CFM Indosuez and Lhyfe SA 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 CFM Indosuez and Lhyfe SA into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between CFM Indosuez Wealth and Lhyfe SA, you can compare the effects of market volatilities on CFM Indosuez and Lhyfe SA 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 CFM Indosuez with a short position of Lhyfe SA. Check out your portfolio center. Please also check ongoing floating volatility patterns of CFM Indosuez and Lhyfe SA.
Diversification Opportunities for CFM Indosuez and Lhyfe SA
-0.26 | Correlation Coefficient |
Very good diversification
The 3 months correlation between CFM and Lhyfe is -0.26. Overlapping area represents the amount of risk that can be diversified away by holding CFM Indosuez Wealth and Lhyfe SA in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Lhyfe SA and CFM Indosuez 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 CFM Indosuez Wealth are associated (or correlated) with Lhyfe SA. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Lhyfe SA has no effect on the direction of CFM Indosuez i.e., CFM Indosuez and Lhyfe SA go up and down completely randomly.
Pair Corralation between CFM Indosuez and Lhyfe SA
Assuming the 90 days trading horizon CFM Indosuez Wealth is expected to generate 0.65 times more return on investment than Lhyfe SA. However, CFM Indosuez Wealth is 1.53 times less risky than Lhyfe SA. It trades about 0.1 of its potential returns per unit of risk. Lhyfe SA is currently generating about -0.07 per unit of risk. If you would invest 89,143 in CFM Indosuez Wealth on September 3, 2024 and sell it today you would earn a total of 25,857 from holding CFM Indosuez Wealth or generate 29.01% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 71.24% |
| Values | Daily Returns |
CFM Indosuez Wealth vs. Lhyfe SA
Performance |
| Timeline |
| CFM Indosuez Wealth |
| Lhyfe SA |
CFM Indosuez and Lhyfe SA Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with CFM Indosuez and Lhyfe SA
The main advantage of trading using opposite CFM Indosuez and Lhyfe SA positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if CFM Indosuez position performs unexpectedly, Lhyfe SA 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 Lhyfe SA will offset losses from the drop in Lhyfe SA's long position.| CFM Indosuez vs. Caisse rgionale de | CFM Indosuez vs. Caisse Regionale de | CFM Indosuez vs. Caisse Rgionale du | CFM Indosuez vs. Caisse Regionale de |
| Lhyfe SA vs. Hydrogene De France | Lhyfe SA vs. Hydrogen Refueling Solutions | Lhyfe SA vs. Neoen SA | Lhyfe SA vs. Hopium SAS |
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 Sign In To Macroaxis module to sign in to explore Macroaxis' wealth optimization platform and fintech modules.
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