Correlation Between Fiducial Office and Gaztransport Technigaz
Can any of the company-specific risk be diversified away by investing in both Fiducial Office and Gaztransport Technigaz 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 Fiducial Office and Gaztransport Technigaz into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Fiducial Office Solutions and Gaztransport Technigaz SAS, you can compare the effects of market volatilities on Fiducial Office and Gaztransport Technigaz 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 Fiducial Office with a short position of Gaztransport Technigaz. Check out your portfolio center. Please also check ongoing floating volatility patterns of Fiducial Office and Gaztransport Technigaz.
Diversification Opportunities for Fiducial Office and Gaztransport Technigaz
0.62 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Fiducial and Gaztransport is 0.62. Overlapping area represents the amount of risk that can be diversified away by holding Fiducial Office Solutions and Gaztransport Technigaz SAS in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Gaztransport Technigaz and Fiducial Office 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 Fiducial Office Solutions are associated (or correlated) with Gaztransport Technigaz. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Gaztransport Technigaz has no effect on the direction of Fiducial Office i.e., Fiducial Office and Gaztransport Technigaz go up and down completely randomly.
Pair Corralation between Fiducial Office and Gaztransport Technigaz
Assuming the 90 days trading horizon Fiducial Office Solutions is expected to generate 0.26 times more return on investment than Gaztransport Technigaz. However, Fiducial Office Solutions is 3.9 times less risky than Gaztransport Technigaz. It trades about 0.05 of its potential returns per unit of risk. Gaztransport Technigaz SAS is currently generating about 0.01 per unit of risk. If you would invest 2,709 in Fiducial Office Solutions on August 27, 2024 and sell it today you would earn a total of 91.00 from holding Fiducial Office Solutions or generate 3.36% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Fiducial Office Solutions vs. Gaztransport Technigaz SAS
Performance |
| Timeline |
| Fiducial Office Solutions |
| Gaztransport Technigaz |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Modest
Fiducial Office and Gaztransport Technigaz Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Fiducial Office and Gaztransport Technigaz
The main advantage of trading using opposite Fiducial Office and Gaztransport Technigaz positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Fiducial Office position performs unexpectedly, Gaztransport Technigaz 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 Gaztransport Technigaz will offset losses from the drop in Gaztransport Technigaz's long position.| Fiducial Office vs. Media 6 SA | Fiducial Office vs. Orapi SA | Fiducial Office vs. Burelle SA | Fiducial Office vs. Manitou BF SA |
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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 Watchlist Optimization module to optimize watchlists to build efficient portfolios or rebalance existing positions based on the mean-variance optimization algorithm.
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