Correlation Between OBSERVE MEDICAL and Crédit Agricole
Can any of the company-specific risk be diversified away by investing in both OBSERVE MEDICAL and Crédit Agricole 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 OBSERVE MEDICAL and Crédit Agricole into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between OBSERVE MEDICAL ASA and Crdit Agricole SA, you can compare the effects of market volatilities on OBSERVE MEDICAL and Crédit Agricole 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 OBSERVE MEDICAL with a short position of Crédit Agricole. Check out your portfolio center. Please also check ongoing floating volatility patterns of OBSERVE MEDICAL and Crédit Agricole.
Diversification Opportunities for OBSERVE MEDICAL and Crédit Agricole
-0.36 | Correlation Coefficient |
Very good diversification
The 3 months correlation between OBSERVE and Crédit is -0.36. Overlapping area represents the amount of risk that can be diversified away by holding OBSERVE MEDICAL ASA and Crdit Agricole SA in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Crdit Agricole SA and OBSERVE MEDICAL 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 OBSERVE MEDICAL ASA are associated (or correlated) with Crédit Agricole. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Crdit Agricole SA has no effect on the direction of OBSERVE MEDICAL i.e., OBSERVE MEDICAL and Crédit Agricole go up and down completely randomly.
Pair Corralation between OBSERVE MEDICAL and Crédit Agricole
Assuming the 90 days trading horizon OBSERVE MEDICAL ASA is expected to under-perform the Crédit Agricole. In addition to that, OBSERVE MEDICAL is 3.36 times more volatile than Crdit Agricole SA. It trades about -0.1 of its total potential returns per unit of risk. Crdit Agricole SA is currently generating about 0.12 per unit of volatility. If you would invest 1,322 in Crdit Agricole SA on October 14, 2024 and sell it today you would earn a total of 29.00 from holding Crdit Agricole SA or generate 2.19% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
OBSERVE MEDICAL ASA vs. Crdit Agricole SA
Performance |
| Timeline |
| OBSERVE MEDICAL ASA |
| Crdit Agricole SA |
OBSERVE MEDICAL and Crédit Agricole Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with OBSERVE MEDICAL and Crédit Agricole
The main advantage of trading using opposite OBSERVE MEDICAL and Crédit Agricole positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if OBSERVE MEDICAL position performs unexpectedly, Crédit Agricole 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 Crédit Agricole will offset losses from the drop in Crédit Agricole's long position.| OBSERVE MEDICAL vs. Harmony Gold Mining | OBSERVE MEDICAL vs. ADRIATIC METALS LS 013355 | OBSERVE MEDICAL vs. Jacquet Metal Service | OBSERVE MEDICAL vs. ARROW ELECTRONICS |
| Crédit Agricole vs. OBSERVE MEDICAL ASA | Crédit Agricole vs. YOOMA WELLNESS INC | Crédit Agricole vs. Japan Tobacco | Crédit Agricole vs. CLOVER HEALTH INV |
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 Premium Stories module to follow Macroaxis premium stories from verified contributors across different equity types, categories and coverage scope.
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