Correlation Between Sumo Resources and Trigano SA
Can any of the company-specific risk be diversified away by investing in both Sumo Resources and Trigano 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 Sumo Resources and Trigano SA into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Sumo Resources PLC and Trigano SA, you can compare the effects of market volatilities on Sumo Resources and Trigano 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 Sumo Resources with a short position of Trigano SA. Check out your portfolio center. Please also check ongoing floating volatility patterns of Sumo Resources and Trigano SA.
Diversification Opportunities for Sumo Resources and Trigano SA
-0.43 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Sumo and Trigano is -0.43. Overlapping area represents the amount of risk that can be diversified away by holding Sumo Resources PLC and Trigano SA in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Trigano SA and Sumo Resources 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 Sumo Resources PLC are associated (or correlated) with Trigano SA. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Trigano SA has no effect on the direction of Sumo Resources i.e., Sumo Resources and Trigano SA go up and down completely randomly.
Pair Corralation between Sumo Resources and Trigano SA
If you would invest 0.45 in Sumo Resources PLC on August 28, 2024 and sell it today you would earn a total of 0.00 from holding Sumo Resources PLC or generate 0.0% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Sumo Resources PLC vs. Trigano SA
Performance |
| Timeline |
| Sumo Resources PLC |
| Trigano SA |
Sumo Resources and Trigano SA Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Sumo Resources and Trigano SA
The main advantage of trading using opposite Sumo Resources and Trigano SA positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Sumo Resources position performs unexpectedly, Trigano 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 Trigano SA will offset losses from the drop in Trigano SA's long position.| Sumo Resources vs. FIPP SA | Sumo Resources vs. Roctool | Sumo Resources vs. Lexibook Linguistic Electronic | Sumo Resources vs. Groupe JAJ |
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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 Correlation Analysis module to reduce portfolio risk simply by holding instruments which are not perfectly correlated.
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