Correlation Between Manitou BF and Imerys SA
Can any of the company-specific risk be diversified away by investing in both Manitou BF and Imerys 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 Imerys 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 Imerys SA, you can compare the effects of market volatilities on Manitou BF and Imerys 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 Imerys SA. Check out your portfolio center. Please also check ongoing floating volatility patterns of Manitou BF and Imerys SA.
Diversification Opportunities for Manitou BF and Imerys SA
0.36 | Correlation Coefficient |
Weak diversification
The 3 months correlation between Manitou and Imerys is 0.36. Overlapping area represents the amount of risk that can be diversified away by holding Manitou BF SA and Imerys SA in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Imerys 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 Imerys SA. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Imerys SA has no effect on the direction of Manitou BF i.e., Manitou BF and Imerys SA go up and down completely randomly.
Pair Corralation between Manitou BF and Imerys SA
Assuming the 90 days trading horizon Manitou BF SA is expected to under-perform the Imerys SA. In addition to that, Manitou BF is 1.08 times more volatile than Imerys SA. It trades about -0.02 of its total potential returns per unit of risk. Imerys SA is currently generating about -0.01 per unit of volatility. If you would invest 3,314 in Imerys SA on August 31, 2024 and sell it today you would lose (484.00) from holding Imerys SA or give up 14.6% 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. Imerys SA
Performance |
| Timeline |
| Manitou BF SA |
| Imerys SA |
Manitou BF and Imerys SA Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Manitou BF and Imerys SA
The main advantage of trading using opposite Manitou BF and Imerys SA positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Manitou BF position performs unexpectedly, Imerys 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 Imerys SA will offset losses from the drop in Imerys SA's long position.| Manitou BF vs. Haulotte Group SA | Manitou BF vs. Trigano SA | Manitou BF vs. Bnteau SA | Manitou BF vs. Derichebourg |
| Imerys SA vs. Rubis SCA | Imerys SA vs. Eramet SA | Imerys SA vs. Nexity | Imerys SA vs. Compagnie de Saint Gobain |
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 Commodity Directory module to find actively traded commodities issued by global exchanges.
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