Correlation Between Rémy Cointreau and Treasury Wine
Can any of the company-specific risk be diversified away by investing in both Rémy Cointreau and Treasury Wine 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 Rémy Cointreau and Treasury Wine into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Rmy Cointreau SA and Treasury Wine Estates, you can compare the effects of market volatilities on Rémy Cointreau and Treasury Wine 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 Rémy Cointreau with a short position of Treasury Wine. Check out your portfolio center. Please also check ongoing floating volatility patterns of Rémy Cointreau and Treasury Wine.
Diversification Opportunities for Rémy Cointreau and Treasury Wine
0.64 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Rémy and Treasury is 0.64. Overlapping area represents the amount of risk that can be diversified away by holding Rmy Cointreau SA and Treasury Wine Estates in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Treasury Wine Estates and Rémy 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 Rmy Cointreau SA are associated (or correlated) with Treasury Wine. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Treasury Wine Estates has no effect on the direction of Rémy Cointreau i.e., Rémy Cointreau and Treasury Wine go up and down completely randomly.
Pair Corralation between Rémy Cointreau and Treasury Wine
Assuming the 90 days horizon Rmy Cointreau SA is expected to under-perform the Treasury Wine. In addition to that, Rémy Cointreau is 1.29 times more volatile than Treasury Wine Estates. It trades about -0.08 of its total potential returns per unit of risk. Treasury Wine Estates is currently generating about 0.03 per unit of volatility. If you would invest 585.00 in Treasury Wine Estates on November 9, 2024 and sell it today you would earn a total of 50.00 from holding Treasury Wine Estates or generate 8.55% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Rmy Cointreau SA vs. Treasury Wine Estates
Performance |
| Timeline |
| Rmy Cointreau SA |
| Treasury Wine Estates |
Rémy Cointreau and Treasury Wine Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Rémy Cointreau and Treasury Wine
The main advantage of trading using opposite Rémy Cointreau and Treasury Wine positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Rémy Cointreau position performs unexpectedly, Treasury Wine 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 Treasury Wine will offset losses from the drop in Treasury Wine's long position.| Rémy Cointreau vs. ADRIATIC METALS LS 013355 | Rémy Cointreau vs. Harmony Gold Mining | Rémy Cointreau vs. MCEWEN MINING INC | Rémy Cointreau vs. Norwegian Air Shuttle |
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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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