Correlation Between Compagnie and Dassault Systemes
Can any of the company-specific risk be diversified away by investing in both Compagnie and Dassault Systemes 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 Compagnie and Dassault Systemes into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Compagnie de Saint Gobain and Dassault Systemes SE, you can compare the effects of market volatilities on Compagnie and Dassault Systemes 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 Compagnie with a short position of Dassault Systemes. Check out your portfolio center. Please also check ongoing floating volatility patterns of Compagnie and Dassault Systemes.
Diversification Opportunities for Compagnie and Dassault Systemes
-0.51 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between Compagnie and Dassault is -0.51. Overlapping area represents the amount of risk that can be diversified away by holding Compagnie de Saint Gobain and Dassault Systemes SE in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Dassault Systemes and Compagnie 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 Compagnie de Saint Gobain are associated (or correlated) with Dassault Systemes. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Dassault Systemes has no effect on the direction of Compagnie i.e., Compagnie and Dassault Systemes go up and down completely randomly.
Pair Corralation between Compagnie and Dassault Systemes
Assuming the 90 days trading horizon Compagnie de Saint Gobain is expected to generate 0.97 times more return on investment than Dassault Systemes. However, Compagnie de Saint Gobain is 1.03 times less risky than Dassault Systemes. It trades about 0.1 of its potential returns per unit of risk. Dassault Systemes SE is currently generating about 0.0 per unit of risk. If you would invest 4,305 in Compagnie de Saint Gobain on August 24, 2024 and sell it today you would earn a total of 4,445 from holding Compagnie de Saint Gobain or generate 103.25% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Compagnie de Saint Gobain vs. Dassault Systemes SE
Performance |
| Timeline |
| Compagnie de Saint |
| Dassault Systemes |
Compagnie and Dassault Systemes Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Compagnie and Dassault Systemes
The main advantage of trading using opposite Compagnie and Dassault Systemes positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Compagnie position performs unexpectedly, Dassault Systemes 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 Dassault Systemes will offset losses from the drop in Dassault Systemes' long position.| Compagnie vs. Vinci SA | Compagnie vs. Air Liquide SA | Compagnie vs. Compagnie Generale des | Compagnie vs. Bouygues SA |
| Dassault Systemes vs. Thales SA | Dassault Systemes vs. Safran SA | Dassault Systemes vs. Air Liquide SA | Dassault Systemes vs. Capgemini SE |
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 Holdings module to check your current holdings and cash postion to detemine if your portfolio needs rebalancing.
Other Complementary Tools
| Price Exposure Probability Analyze equity upside and downside potential for a given time horizon across multiple markets | |
| Stock Tickers Use high-impact, comprehensive, and customizable stock tickers that can be easily integrated to any websites | |
| Commodity Channel Use Commodity Channel Index to analyze current equity momentum | |
| Share Portfolio Track or share privately all of your investments from the convenience of any device | |
| Instant Ratings Determine any equity ratings based on digital recommendations. Macroaxis instant equity ratings are based on combination of fundamental analysis and risk-adjusted market performance |