Correlation Between Savencia and Burelle SA
Can any of the company-specific risk be diversified away by investing in both Savencia and Burelle SA 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 Savencia and Burelle SA into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Savencia SA and Burelle SA, you can compare the effects of market volatilities on Savencia and Burelle SA 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 Savencia with a short position of Burelle SA. Check out your portfolio center. Please also check ongoing floating volatility patterns of Savencia and Burelle SA.
Diversification Opportunities for Savencia and Burelle SA
0.25 | Correlation Coefficient |
Modest diversification
The 3 months correlation between Savencia and Burelle is 0.25. Overlapping area represents the amount of risk that can be diversified away by holding Savencia SA and Burelle SA in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Burelle SA and Savencia 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 Savencia SA are associated (or correlated) with Burelle SA. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Burelle SA has no effect on the direction of Savencia i.e., Savencia and Burelle SA go up and down completely randomly.
Pair Corralation between Savencia and Burelle SA
Assuming the 90 days trading horizon Savencia SA is expected to generate 0.67 times more return on investment than Burelle SA. However, Savencia SA is 1.5 times less risky than Burelle SA. It trades about 0.02 of its potential returns per unit of risk. Burelle SA is currently generating about -0.11 per unit of risk. If you would invest 5,180 in Savencia SA on August 26, 2024 and sell it today you would earn a total of 20.00 from holding Savencia SA or generate 0.39% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Savencia SA vs. Burelle SA
Performance |
| Timeline |
| Savencia SA |
| Burelle SA |
Savencia and Burelle SA Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Savencia and Burelle SA
The main advantage of trading using opposite Savencia and Burelle SA positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Savencia position performs unexpectedly, Burelle SA 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 Burelle SA will offset losses from the drop in Burelle SA's long position.The idea behind Savencia SA and Burelle SA pairs trading is to make the combined position market-neutral, meaning the overall market's direction will not affect its win or loss (or potential downside or upside). This can be achieved by designing a pairs trade with two highly correlated stocks or equities that operate in a similar space or sector, making it possible to obtain profits through simple and relatively low-risk investment.| Burelle SA vs. Savencia SA | Burelle SA vs. Compagnie de lOdet | Burelle SA vs. Akwel SA | Burelle SA vs. Wendel |
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 Equity Valuation module to check real value of public entities based on technical and fundamental data.
Other Complementary Tools
| Positions Ratings Determine portfolio positions ratings based on digital equity recommendations. Macroaxis instant position ratings are based on combination of fundamental analysis and risk-adjusted market performance | |
| Portfolio Center All portfolio management and optimization tools to improve performance of your portfolios | |
| Global Correlations Find global opportunities by holding instruments from different markets | |
| Crypto Correlations Use cryptocurrency correlation module to diversify your cryptocurrency portfolio across multiple coins | |
| Portfolio Holdings Check your current holdings and cash postion to detemine if your portfolio needs rebalancing |