Correlation Between Manitou BF and Compagnie
Can any of the company-specific risk be diversified away by investing in both Manitou BF and Compagnie 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 Compagnie 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 Compagnie Du Mont Blanc, you can compare the effects of market volatilities on Manitou BF and Compagnie 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 Compagnie. Check out your portfolio center. Please also check ongoing floating volatility patterns of Manitou BF and Compagnie.
Diversification Opportunities for Manitou BF and Compagnie
-0.32 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Manitou and Compagnie is -0.32. Overlapping area represents the amount of risk that can be diversified away by holding Manitou BF SA and Compagnie Du Mont Blanc in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Compagnie Du Mont 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 Compagnie. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Compagnie Du Mont has no effect on the direction of Manitou BF i.e., Manitou BF and Compagnie go up and down completely randomly.
Pair Corralation between Manitou BF and Compagnie
Assuming the 90 days trading horizon Manitou BF SA is expected to under-perform the Compagnie. In addition to that, Manitou BF is 1.14 times more volatile than Compagnie Du Mont Blanc. It trades about -0.18 of its total potential returns per unit of risk. Compagnie Du Mont Blanc is currently generating about 0.09 per unit of volatility. If you would invest 14,000 in Compagnie Du Mont Blanc on September 2, 2024 and sell it today you would earn a total of 400.00 from holding Compagnie Du Mont Blanc or generate 2.86% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Manitou BF SA vs. Compagnie Du Mont Blanc
Performance |
| Timeline |
| Manitou BF SA |
| Compagnie Du Mont |
Manitou BF and Compagnie Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Manitou BF and Compagnie
The main advantage of trading using opposite Manitou BF and Compagnie positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Manitou BF position performs unexpectedly, Compagnie 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 Compagnie will offset losses from the drop in Compagnie's long position.| Manitou BF vs. Air Liquide SA | Manitou BF vs. Vinci SA | Manitou BF vs. LOreal SA | Manitou BF vs. Compagnie de Saint Gobain |
| Compagnie vs. Bonduelle SCA | Compagnie vs. Imerys SA | Compagnie vs. Manitou BF SA | Compagnie vs. Ossiam Minimum Variance |
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 Balance Of Power module to check stock momentum by analyzing Balance Of Power indicator and other technical ratios.
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