Correlation Between SBF 120 and Aeroports
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By analyzing existing cross correlation between SBF 120 and Aeroports de Paris, you can compare the effects of market volatilities on SBF 120 and Aeroports 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 SBF 120 with a short position of Aeroports. Check out your portfolio center. Please also check ongoing floating volatility patterns of SBF 120 and Aeroports.
Diversification Opportunities for SBF 120 and Aeroports
Poor diversification
The 3 months correlation between SBF and Aeroports is 0.62. Overlapping area represents the amount of risk that can be diversified away by holding SBF 120 and Aeroports de Paris in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Aeroports de Paris and SBF 120 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 SBF 120 are associated (or correlated) with Aeroports. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Aeroports de Paris has no effect on the direction of SBF 120 i.e., SBF 120 and Aeroports go up and down completely randomly.
Pair Corralation between SBF 120 and Aeroports
Assuming the 90 days trading horizon SBF 120 is expected to under-perform the Aeroports. But the index apears to be less risky and, when comparing its historical volatility, SBF 120 is 1.39 times less risky than Aeroports. The index trades about -0.16 of its potential returns per unit of risk. The Aeroports de Paris is currently generating about -0.04 of returns per unit of risk over similar time horizon. If you would invest 10,990 in Aeroports de Paris on August 25, 2024 and sell it today you would lose (130.00) from holding Aeroports de Paris or give up 1.18% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
SBF 120 vs. Aeroports de Paris
Performance |
| Timeline |
SBF 120 and Aeroports Volatility Contrast
Predicted Return Density |
| Returns |
SBF 120
Pair trading matchups for SBF 120
Aeroports de Paris
Pair trading matchups for Aeroports
Pair Trading with SBF 120 and Aeroports
The main advantage of trading using opposite SBF 120 and Aeroports positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if SBF 120 position performs unexpectedly, Aeroports 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 Aeroports will offset losses from the drop in Aeroports' long position.| SBF 120 vs. Mauna Kea Technologies | SBF 120 vs. Axway Software | SBF 120 vs. Soditech SA | SBF 120 vs. Guandao Puer Investment |
| Aeroports vs. Prodways Group SA | Aeroports vs. Claranova SE | Aeroports vs. DBV Technologies SA | Aeroports vs. Manitou BF 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 Portfolio Rebalancing module to analyze risk-adjusted returns against different time horizons to find asset-allocation targets.
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