Correlation Between Remy Cointreau and La Savonnerie
Can any of the company-specific risk be diversified away by investing in both Remy Cointreau and La Savonnerie 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 Remy Cointreau and La Savonnerie into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Remy Cointreau and La Savonnerie de, you can compare the effects of market volatilities on Remy Cointreau and La Savonnerie 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 Remy Cointreau with a short position of La Savonnerie. Check out your portfolio center. Please also check ongoing floating volatility patterns of Remy Cointreau and La Savonnerie.
Diversification Opportunities for Remy Cointreau and La Savonnerie
-0.51 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between Remy and MLSDN is -0.51. Overlapping area represents the amount of risk that can be diversified away by holding Remy Cointreau and La Savonnerie de in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on La Savonnerie de and Remy Cointreau 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 Remy Cointreau are associated (or correlated) with La Savonnerie. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of La Savonnerie de has no effect on the direction of Remy Cointreau i.e., Remy Cointreau and La Savonnerie go up and down completely randomly.
Pair Corralation between Remy Cointreau and La Savonnerie
Assuming the 90 days trading horizon Remy Cointreau is expected to under-perform the La Savonnerie. But the stock apears to be less risky and, when comparing its historical volatility, Remy Cointreau is 1.93 times less risky than La Savonnerie. The stock trades about -0.08 of its potential returns per unit of risk. The La Savonnerie de is currently generating about 0.03 of returns per unit of risk over similar time horizon. If you would invest 2,742 in La Savonnerie de on August 26, 2024 and sell it today you would earn a total of 238.00 from holding La Savonnerie de or generate 8.68% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 94.47% |
| Values | Daily Returns |
Remy Cointreau vs. La Savonnerie de
Performance |
| Timeline |
| Remy Cointreau |
| La Savonnerie de |
Remy Cointreau and La Savonnerie Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Remy Cointreau and La Savonnerie
The main advantage of trading using opposite Remy Cointreau and La Savonnerie positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Remy Cointreau position performs unexpectedly, La Savonnerie 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 La Savonnerie will offset losses from the drop in La Savonnerie's long position.| Remy Cointreau vs. Pernod Ricard SA | Remy Cointreau vs. SEB SA | Remy Cointreau vs. Sodexo SA | Remy Cointreau vs. Wendel |
| La Savonnerie vs. Remy Cointreau | La Savonnerie vs. Alten SA | La Savonnerie vs. Gaztransport Technigaz SAS | La Savonnerie vs. Trigano SA |
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 Investing Opportunities module to build portfolios using our predefined set of ideas and optimize them against your investing preferences.
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