Correlation Between Publicis Groupe and Global Payout
Can any of the company-specific risk be diversified away by investing in both Publicis Groupe and Global Payout 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 Publicis Groupe and Global Payout into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Publicis Groupe SA and Global Payout, you can compare the effects of market volatilities on Publicis Groupe and Global Payout 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 Publicis Groupe with a short position of Global Payout. Check out your portfolio center. Please also check ongoing floating volatility patterns of Publicis Groupe and Global Payout.
Diversification Opportunities for Publicis Groupe and Global Payout
-0.25 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Publicis and Global is -0.25. Overlapping area represents the amount of risk that can be diversified away by holding Publicis Groupe SA and Global Payout in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Global Payout and Publicis Groupe 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 Publicis Groupe SA are associated (or correlated) with Global Payout. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Global Payout has no effect on the direction of Publicis Groupe i.e., Publicis Groupe and Global Payout go up and down completely randomly.
Pair Corralation between Publicis Groupe and Global Payout
Assuming the 90 days horizon Publicis Groupe is expected to generate 44.61 times less return on investment than Global Payout. But when comparing it to its historical volatility, Publicis Groupe SA is 14.8 times less risky than Global Payout. It trades about 0.02 of its potential returns per unit of risk. Global Payout is currently generating about 0.07 of returns per unit of risk over similar time horizon. If you would invest 0.08 in Global Payout on November 4, 2024 and sell it today you would lose (0.05) from holding Global Payout or give up 62.5% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Publicis Groupe SA vs. Global Payout
Performance |
| Timeline |
| Publicis Groupe SA |
| Global Payout |
Publicis Groupe and Global Payout Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Publicis Groupe and Global Payout
The main advantage of trading using opposite Publicis Groupe and Global Payout positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Publicis Groupe position performs unexpectedly, Global Payout 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 Global Payout will offset losses from the drop in Global Payout's long position.| Publicis Groupe vs. INEO Tech Corp | Publicis Groupe vs. Marchex | Publicis Groupe vs. Snipp Interactive | Publicis Groupe vs. Mirriad Advertising plc |
| Global Payout vs. Clubhouse Media Group | Global Payout vs. ZW Data Action | Global Payout vs. Sun Pacific Holding | Global Payout vs. CMG Holdings Group |
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 Manager module to state of the art Portfolio Manager to monitor and improve performance of your invested capital.
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