Correlation Between Publicis Groupe and SES S
Can any of the company-specific risk be diversified away by investing in both Publicis Groupe and SES S 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 SES S 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 SES S A, you can compare the effects of market volatilities on Publicis Groupe and SES S 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 SES S. Check out your portfolio center. Please also check ongoing floating volatility patterns of Publicis Groupe and SES S.
Diversification Opportunities for Publicis Groupe and SES S
-0.69 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between Publicis and SES is -0.69. Overlapping area represents the amount of risk that can be diversified away by holding Publicis Groupe SA and SES S A in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on SES S A 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 SES S. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of SES S A has no effect on the direction of Publicis Groupe i.e., Publicis Groupe and SES S go up and down completely randomly.
Pair Corralation between Publicis Groupe and SES S
Assuming the 90 days trading horizon Publicis Groupe SA is expected to generate 1.1 times more return on investment than SES S. However, Publicis Groupe is 1.1 times more volatile than SES S A. It trades about 0.13 of its potential returns per unit of risk. SES S A is currently generating about -0.3 per unit of risk. If you would invest 9,824 in Publicis Groupe SA on September 3, 2024 and sell it today you would earn a total of 446.00 from holding Publicis Groupe SA or generate 4.54% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Publicis Groupe SA vs. SES S A
Performance |
| Timeline |
| Publicis Groupe SA |
| SES S A |
Publicis Groupe and SES S Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Publicis Groupe and SES S
The main advantage of trading using opposite Publicis Groupe and SES S positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Publicis Groupe position performs unexpectedly, SES S 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 SES S will offset losses from the drop in SES S's long position.| Publicis Groupe vs. Bouygues SA | Publicis Groupe vs. Legrand SA | Publicis Groupe vs. Sodexo SA | Publicis Groupe vs. Compagnie de Saint Gobain |
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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