Correlation Between Groupe Partouche and NRJ
Can any of the company-specific risk be diversified away by investing in both Groupe Partouche and NRJ 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 Groupe Partouche and NRJ into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Groupe Partouche SA and NRJ Group, you can compare the effects of market volatilities on Groupe Partouche and NRJ 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 Groupe Partouche with a short position of NRJ. Check out your portfolio center. Please also check ongoing floating volatility patterns of Groupe Partouche and NRJ.
Diversification Opportunities for Groupe Partouche and NRJ
-0.55 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between Groupe and NRJ is -0.55. Overlapping area represents the amount of risk that can be diversified away by holding Groupe Partouche SA and NRJ Group in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on NRJ Group and Groupe Partouche 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 Groupe Partouche SA are associated (or correlated) with NRJ. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of NRJ Group has no effect on the direction of Groupe Partouche i.e., Groupe Partouche and NRJ go up and down completely randomly.
Pair Corralation between Groupe Partouche and NRJ
Assuming the 90 days trading horizon Groupe Partouche SA is expected to generate 1.11 times more return on investment than NRJ. However, Groupe Partouche is 1.11 times more volatile than NRJ Group. It trades about 0.01 of its potential returns per unit of risk. NRJ Group is currently generating about -0.04 per unit of risk. If you would invest 2,020 in Groupe Partouche SA on August 29, 2024 and sell it today you would lose (10.00) from holding Groupe Partouche SA or give up 0.5% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Groupe Partouche SA vs. NRJ Group
Performance |
| Timeline |
| Groupe Partouche |
| NRJ Group |
Groupe Partouche and NRJ Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Groupe Partouche and NRJ
The main advantage of trading using opposite Groupe Partouche and NRJ positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Groupe Partouche position performs unexpectedly, NRJ 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 NRJ will offset losses from the drop in NRJ's long position.| Groupe Partouche vs. Passat Socit Anonyme | Groupe Partouche vs. Plastiques du Val | Groupe Partouche vs. NRJ Group | Groupe Partouche vs. Haulotte Group SA |
| NRJ vs. Television Francaise 1 | NRJ vs. Mtropole Tlvision SA | NRJ vs. Haulotte Group SA | NRJ vs. VIEL Cie socit |
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 Portfolio Volatility module to check portfolio volatility and analyze historical return density to properly model market risk.
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