Correlation Between SERI INDUSTRIAL and Compagnie Plastic
Can any of the company-specific risk be diversified away by investing in both SERI INDUSTRIAL and Compagnie Plastic 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 SERI INDUSTRIAL and Compagnie Plastic into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between SERI INDUSTRIAL EO and Compagnie Plastic Omnium, you can compare the effects of market volatilities on SERI INDUSTRIAL and Compagnie Plastic 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 SERI INDUSTRIAL with a short position of Compagnie Plastic. Check out your portfolio center. Please also check ongoing floating volatility patterns of SERI INDUSTRIAL and Compagnie Plastic.
Diversification Opportunities for SERI INDUSTRIAL and Compagnie Plastic
-0.77 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between SERI and Compagnie is -0.77. Overlapping area represents the amount of risk that can be diversified away by holding SERI INDUSTRIAL EO and Compagnie Plastic Omnium in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Compagnie Plastic Omnium and SERI INDUSTRIAL 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 SERI INDUSTRIAL EO are associated (or correlated) with Compagnie Plastic. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Compagnie Plastic Omnium has no effect on the direction of SERI INDUSTRIAL i.e., SERI INDUSTRIAL and Compagnie Plastic go up and down completely randomly.
Pair Corralation between SERI INDUSTRIAL and Compagnie Plastic
Assuming the 90 days trading horizon SERI INDUSTRIAL EO is expected to under-perform the Compagnie Plastic. In addition to that, SERI INDUSTRIAL is 1.55 times more volatile than Compagnie Plastic Omnium. It trades about -0.3 of its total potential returns per unit of risk. Compagnie Plastic Omnium is currently generating about 0.11 per unit of volatility. If you would invest 996.00 in Compagnie Plastic Omnium on October 17, 2024 and sell it today you would earn a total of 36.00 from holding Compagnie Plastic Omnium or generate 3.61% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 94.44% |
| Values | Daily Returns |
SERI INDUSTRIAL EO vs. Compagnie Plastic Omnium
Performance |
| Timeline |
| SERI INDUSTRIAL EO |
| Compagnie Plastic Omnium |
SERI INDUSTRIAL and Compagnie Plastic Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with SERI INDUSTRIAL and Compagnie Plastic
The main advantage of trading using opposite SERI INDUSTRIAL and Compagnie Plastic positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if SERI INDUSTRIAL position performs unexpectedly, Compagnie Plastic 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 Plastic will offset losses from the drop in Compagnie Plastic's long position.| SERI INDUSTRIAL vs. VARIOUS EATERIES LS | SERI INDUSTRIAL vs. WESANA HEALTH HOLD | SERI INDUSTRIAL vs. SWISS WATER DECAFFCOFFEE | SERI INDUSTRIAL vs. Perseus Mining Limited |
| Compagnie Plastic vs. SERI INDUSTRIAL EO | Compagnie Plastic vs. Jacquet Metal Service | Compagnie Plastic vs. British American Tobacco | Compagnie Plastic vs. JAPAN TOBACCO UNSPADR12 |
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 Anywhere module to track or share privately all of your investments from the convenience of any device.
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