Correlation Between Publicis Groupe and WPP PLC
Can any of the company-specific risk be diversified away by investing in both Publicis Groupe and WPP PLC 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 WPP PLC 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 WPP PLC ADR, you can compare the effects of market volatilities on Publicis Groupe and WPP PLC 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 WPP PLC. Check out your portfolio center. Please also check ongoing floating volatility patterns of Publicis Groupe and WPP PLC.
Diversification Opportunities for Publicis Groupe and WPP PLC
0.0 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between Publicis and WPP is 0.0. Overlapping area represents the amount of risk that can be diversified away by holding Publicis Groupe SA and WPP PLC ADR in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on WPP PLC ADR 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 WPP PLC. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of WPP PLC ADR has no effect on the direction of Publicis Groupe i.e., Publicis Groupe and WPP PLC go up and down completely randomly.
Pair Corralation between Publicis Groupe and WPP PLC
If you would invest 4,192 in WPP PLC ADR on August 30, 2024 and sell it today you would earn a total of 858.00 from holding WPP PLC ADR or generate 20.47% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Flat |
| Strength | Insignificant |
| Accuracy | 1.54% |
| Values | Daily Returns |
Publicis Groupe SA vs. WPP PLC ADR
Performance |
| Timeline |
| Publicis Groupe SA |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Weak
| WPP PLC ADR |
Publicis Groupe and WPP PLC Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Publicis Groupe and WPP PLC
The main advantage of trading using opposite Publicis Groupe and WPP PLC positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Publicis Groupe position performs unexpectedly, WPP PLC 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 WPP PLC will offset losses from the drop in WPP PLC's long position.| Publicis Groupe vs. Tencent Music Entertainment | Publicis Groupe vs. GigaMedia | Publicis Groupe vs. METHODE ELECTRONICS | Publicis Groupe vs. CNVISION MEDIA |
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 Companies Directory module to evaluate performance of over 100,000 Stocks, Funds, and ETFs against different fundamentals.
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