Correlation Between Sch Environnement and STORE ELECTRONIC
Can any of the company-specific risk be diversified away by investing in both Sch Environnement and STORE ELECTRONIC 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 Sch Environnement and STORE ELECTRONIC into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Sch Environnement SA and STORE ELECTRONIC, you can compare the effects of market volatilities on Sch Environnement and STORE ELECTRONIC 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 Sch Environnement with a short position of STORE ELECTRONIC. Check out your portfolio center. Please also check ongoing floating volatility patterns of Sch Environnement and STORE ELECTRONIC.
Diversification Opportunities for Sch Environnement and STORE ELECTRONIC
-0.51 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between Sch and STORE is -0.51. Overlapping area represents the amount of risk that can be diversified away by holding Sch Environnement SA and STORE ELECTRONIC in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on STORE ELECTRONIC and Sch Environnement 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 Sch Environnement SA are associated (or correlated) with STORE ELECTRONIC. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of STORE ELECTRONIC has no effect on the direction of Sch Environnement i.e., Sch Environnement and STORE ELECTRONIC go up and down completely randomly.
Pair Corralation between Sch Environnement and STORE ELECTRONIC
Assuming the 90 days horizon Sch Environnement is expected to generate 16.93 times less return on investment than STORE ELECTRONIC. But when comparing it to its historical volatility, Sch Environnement SA is 1.35 times less risky than STORE ELECTRONIC. It trades about 0.01 of its potential returns per unit of risk. STORE ELECTRONIC is currently generating about 0.15 of returns per unit of risk over similar time horizon. If you would invest 14,020 in STORE ELECTRONIC on October 30, 2024 and sell it today you would earn a total of 2,470 from holding STORE ELECTRONIC or generate 17.62% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Sch Environnement SA vs. STORE ELECTRONIC
Performance |
| Timeline |
| Sch Environnement |
| STORE ELECTRONIC |
Sch Environnement and STORE ELECTRONIC Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Sch Environnement and STORE ELECTRONIC
The main advantage of trading using opposite Sch Environnement and STORE ELECTRONIC positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Sch Environnement position performs unexpectedly, STORE ELECTRONIC 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 STORE ELECTRONIC will offset losses from the drop in STORE ELECTRONIC's long position.| Sch Environnement vs. VARIOUS EATERIES LS | Sch Environnement vs. SCANDMEDICAL SOLDK 040 | Sch Environnement vs. SWISS WATER DECAFFCOFFEE | Sch Environnement vs. Japan Medical Dynamic |
| STORE ELECTRONIC vs. Apple Inc | STORE ELECTRONIC vs. Apple Inc | STORE ELECTRONIC vs. Apple Inc | STORE ELECTRONIC vs. Apple Inc |
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 Pair Correlation module to compare performance and examine fundamental relationship between any two equity instruments.
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