Correlation Between CMG Cleantech and Lhyfe SA
Can any of the company-specific risk be diversified away by investing in both CMG Cleantech 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 CMG Cleantech and Lhyfe SA into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between CMG Cleantech SA and Lhyfe SA, you can compare the effects of market volatilities on CMG Cleantech 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 CMG Cleantech with a short position of Lhyfe SA. Check out your portfolio center. Please also check ongoing floating volatility patterns of CMG Cleantech and Lhyfe SA.
Diversification Opportunities for CMG Cleantech and Lhyfe SA
-0.7 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between CMG and Lhyfe is -0.7. Overlapping area represents the amount of risk that can be diversified away by holding CMG Cleantech SA and Lhyfe SA in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Lhyfe SA and CMG Cleantech 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 CMG Cleantech SA 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 CMG Cleantech i.e., CMG Cleantech and Lhyfe SA go up and down completely randomly.
Pair Corralation between CMG Cleantech and Lhyfe SA
Assuming the 90 days trading horizon CMG Cleantech SA is expected to generate 1.62 times more return on investment than Lhyfe SA. However, CMG Cleantech is 1.62 times more volatile than Lhyfe SA. It trades about 0.02 of its potential returns per unit of risk. Lhyfe SA is currently generating about -0.05 per unit of risk. If you would invest 149.00 in CMG Cleantech SA on August 31, 2024 and sell it today you would lose (26.00) from holding CMG Cleantech SA or give up 17.45% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
CMG Cleantech SA vs. Lhyfe SA
Performance |
| Timeline |
| CMG Cleantech SA |
| Lhyfe SA |
CMG Cleantech and Lhyfe SA Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with CMG Cleantech and Lhyfe SA
The main advantage of trading using opposite CMG Cleantech and Lhyfe SA positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if CMG Cleantech 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.| CMG Cleantech vs. EPC Groupe | CMG Cleantech vs. Groupe Sfpi | CMG Cleantech vs. Baikowski SASU | CMG Cleantech vs. NSE SA |
| 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 Stock Tickers module to use high-impact, comprehensive, and customizable stock tickers that can be easily integrated to any websites.
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