Correlation Between Compagnie and Remy Cointreau
Can any of the company-specific risk be diversified away by investing in both Compagnie and Remy Cointreau 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 Remy Cointreau 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 Remy Cointreau, you can compare the effects of market volatilities on Compagnie and Remy Cointreau 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 Remy Cointreau. Check out your portfolio center. Please also check ongoing floating volatility patterns of Compagnie and Remy Cointreau.
Diversification Opportunities for Compagnie and Remy Cointreau
-0.75 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between Compagnie and Remy is -0.75. Overlapping area represents the amount of risk that can be diversified away by holding Compagnie de Saint Gobain and Remy Cointreau in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Remy Cointreau 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 Remy Cointreau. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Remy Cointreau has no effect on the direction of Compagnie i.e., Compagnie and Remy Cointreau go up and down completely randomly.
Pair Corralation between Compagnie and Remy Cointreau
Assuming the 90 days trading horizon Compagnie de Saint Gobain is expected to generate 0.6 times more return on investment than Remy Cointreau. However, Compagnie de Saint Gobain is 1.67 times less risky than Remy Cointreau. It trades about 0.1 of its potential returns per unit of risk. Remy Cointreau is currently generating about -0.16 per unit of risk. If you would invest 8,172 in Compagnie de Saint Gobain on August 31, 2024 and sell it today you would earn a total of 434.00 from holding Compagnie de Saint Gobain or generate 5.31% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 97.78% |
| Values | Daily Returns |
Compagnie de Saint Gobain vs. Remy Cointreau
Performance |
| Timeline |
| Compagnie de Saint |
| Remy Cointreau |
Compagnie and Remy Cointreau Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Compagnie and Remy Cointreau
The main advantage of trading using opposite Compagnie and Remy Cointreau positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Compagnie position performs unexpectedly, Remy Cointreau 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 Remy Cointreau will offset losses from the drop in Remy Cointreau's long position.| Compagnie vs. Vinci SA | Compagnie vs. Air Liquide SA | Compagnie vs. Compagnie Generale des | Compagnie vs. Bouygues SA |
| Remy Cointreau vs. Pernod Ricard SA | Remy Cointreau vs. SEB SA | Remy Cointreau vs. Sodexo SA | Remy Cointreau 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 USA ETFs module to find actively traded Exchange Traded Funds (ETF) in USA.
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