Correlation Between Manitou BF and Bouygues
Can any of the company-specific risk be diversified away by investing in both Manitou BF and Bouygues 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 Bouygues 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 Bouygues SA, you can compare the effects of market volatilities on Manitou BF and Bouygues 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 Bouygues. Check out your portfolio center. Please also check ongoing floating volatility patterns of Manitou BF and Bouygues.
Diversification Opportunities for Manitou BF and Bouygues
0.35 | Correlation Coefficient |
Weak diversification
The 3 months correlation between Manitou and Bouygues is 0.35. Overlapping area represents the amount of risk that can be diversified away by holding Manitou BF SA and Bouygues SA in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Bouygues 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 Bouygues. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Bouygues SA has no effect on the direction of Manitou BF i.e., Manitou BF and Bouygues go up and down completely randomly.
Pair Corralation between Manitou BF and Bouygues
Assuming the 90 days trading horizon Manitou BF SA is expected to under-perform the Bouygues. In addition to that, Manitou BF is 1.92 times more volatile than Bouygues SA. It trades about -0.05 of its total potential returns per unit of risk. Bouygues SA is currently generating about -0.08 per unit of volatility. If you would invest 3,467 in Bouygues SA on August 27, 2024 and sell it today you would lose (587.00) from holding Bouygues SA or give up 16.93% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Manitou BF SA vs. Bouygues SA
Performance |
| Timeline |
| Manitou BF SA |
| Bouygues SA |
Manitou BF and Bouygues Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Manitou BF and Bouygues
The main advantage of trading using opposite Manitou BF and Bouygues positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Manitou BF position performs unexpectedly, Bouygues 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 Bouygues will offset losses from the drop in Bouygues' long position.| Manitou BF vs. Haulotte Group SA | Manitou BF vs. Trigano SA | Manitou BF vs. Bnteau SA | Manitou BF vs. Derichebourg |
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 Piotroski F Score module to get Piotroski F Score based on the binary analysis strategy of nine different fundamentals.
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