Correlation Between Nasdaq and Lagardere
Can any of the company-specific risk be diversified away by investing in both Nasdaq and Lagardere 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 Nasdaq and Lagardere into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Nasdaq Inc and Lagardere SA, you can compare the effects of market volatilities on Nasdaq and Lagardere 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 Nasdaq with a short position of Lagardere. Check out your portfolio center. Please also check ongoing floating volatility patterns of Nasdaq and Lagardere.
Diversification Opportunities for Nasdaq and Lagardere
Very good diversification
The 3 months correlation between Nasdaq and Lagardere is -0.42. Overlapping area represents the amount of risk that can be diversified away by holding Nasdaq Inc and Lagardere SA in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Lagardere SA and Nasdaq 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 Nasdaq Inc are associated (or correlated) with Lagardere. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Lagardere SA has no effect on the direction of Nasdaq i.e., Nasdaq and Lagardere go up and down completely randomly.
Pair Corralation between Nasdaq and Lagardere
Given the investment horizon of 90 days Nasdaq Inc is expected to generate 0.87 times more return on investment than Lagardere. However, Nasdaq Inc is 1.14 times less risky than Lagardere. It trades about 0.08 of its potential returns per unit of risk. Lagardere SA is currently generating about 0.01 per unit of risk. If you would invest 5,035 in Nasdaq Inc on December 4, 2024 and sell it today you would earn a total of 3,162 from holding Nasdaq Inc or generate 62.8% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 49.7% |
| Values | Daily Returns |
Nasdaq Inc vs. Lagardere SA
Performance |
| Timeline |
| Nasdaq Inc |
| Lagardere SA |
Nasdaq and Lagardere Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Nasdaq and Lagardere
The main advantage of trading using opposite Nasdaq and Lagardere positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Nasdaq position performs unexpectedly, Lagardere 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 Lagardere will offset losses from the drop in Lagardere's long position.The idea behind Nasdaq Inc and Lagardere SA pairs trading is to make the combined position market-neutral, meaning the overall market's direction will not affect its win or loss (or potential downside or upside). This can be achieved by designing a pairs trade with two highly correlated stocks or equities that operate in a similar space or sector, making it possible to obtain profits through simple and relatively low-risk investment.| Lagardere vs. Alto Neuroscience, | Lagardere vs. Centessa Pharmaceuticals PLC | Lagardere vs. Paranovus Entertainment Technology | Lagardere vs. SNDL Inc |
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 Performance Analysis module to check effects of mean-variance optimization against your current asset allocation.
Other Complementary Tools
| Funds Screener Find actively-traded funds from around the world traded on over 30 global exchanges | |
| Portfolio Rebalancing Analyze risk-adjusted returns against different time horizons to find asset-allocation targets | |
| Performance Analysis Check effects of mean-variance optimization against your current asset allocation | |
| Global Correlations Find global opportunities by holding instruments from different markets | |
| Stocks Directory Find actively traded stocks across global markets |