Correlation Between Manitou BF and Burelle SA
Can any of the company-specific risk be diversified away by investing in both Manitou BF and Burelle 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 Manitou BF and Burelle SA into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Manitou BF SA and Burelle SA, you can compare the effects of market volatilities on Manitou BF and Burelle 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 Manitou BF with a short position of Burelle SA. Check out your portfolio center. Please also check ongoing floating volatility patterns of Manitou BF and Burelle SA.
Diversification Opportunities for Manitou BF and Burelle SA
0.73 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Manitou and Burelle is 0.73. Overlapping area represents the amount of risk that can be diversified away by holding Manitou BF SA and Burelle SA in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Burelle SA and Manitou BF 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 Manitou BF SA are associated (or correlated) with Burelle SA. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Burelle SA has no effect on the direction of Manitou BF i.e., Manitou BF and Burelle SA go up and down completely randomly.
Pair Corralation between Manitou BF and Burelle SA
Assuming the 90 days trading horizon Manitou BF SA is expected to under-perform the Burelle SA. In addition to that, Manitou BF is 1.01 times more volatile than Burelle SA. It trades about -0.07 of its total potential returns per unit of risk. Burelle SA is currently generating about -0.05 per unit of volatility. If you would invest 34,500 in Burelle SA on August 26, 2024 and sell it today you would lose (1,700) from holding Burelle SA or give up 4.93% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Manitou BF SA vs. Burelle SA
Performance |
| Timeline |
| Manitou BF SA |
| Burelle SA |
Manitou BF and Burelle SA Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Manitou BF and Burelle SA
The main advantage of trading using opposite Manitou BF and Burelle SA positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Manitou BF position performs unexpectedly, Burelle 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 Burelle SA will offset losses from the drop in Burelle SA's long position.| Manitou BF vs. Haulotte Group SA | Manitou BF vs. Trigano SA | Manitou BF vs. Bnteau SA | Manitou BF vs. Derichebourg |
| Burelle SA vs. Savencia SA | Burelle SA vs. Compagnie de lOdet | Burelle SA vs. Akwel SA | Burelle SA vs. Wendel |
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 ETF Categories module to list of ETF categories grouped based on various criteria, such as the investment strategy or type of investments.
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