Correlation Between Sodexo SA and Vente Unique
Can any of the company-specific risk be diversified away by investing in both Sodexo SA and Vente Unique 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 Sodexo SA and Vente Unique into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Sodexo SA and Vente Unique, you can compare the effects of market volatilities on Sodexo SA and Vente Unique 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 Sodexo SA with a short position of Vente Unique. Check out your portfolio center. Please also check ongoing floating volatility patterns of Sodexo SA and Vente Unique.
Diversification Opportunities for Sodexo SA and Vente Unique
-0.32 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Sodexo and Vente is -0.32. Overlapping area represents the amount of risk that can be diversified away by holding Sodexo SA and Vente Unique in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Vente Unique and Sodexo SA 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 Sodexo SA are associated (or correlated) with Vente Unique. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Vente Unique has no effect on the direction of Sodexo SA i.e., Sodexo SA and Vente Unique go up and down completely randomly.
Pair Corralation between Sodexo SA and Vente Unique
Assuming the 90 days horizon Sodexo SA is expected to generate 0.6 times more return on investment than Vente Unique. However, Sodexo SA is 1.68 times less risky than Vente Unique. It trades about -0.09 of its potential returns per unit of risk. Vente Unique is currently generating about -0.24 per unit of risk. If you would invest 8,145 in Sodexo SA on August 29, 2024 and sell it today you would lose (210.00) from holding Sodexo SA or give up 2.58% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Sodexo SA vs. Vente Unique
Performance |
| Timeline |
| Sodexo SA |
| Vente Unique |
Sodexo SA and Vente Unique Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Sodexo SA and Vente Unique
The main advantage of trading using opposite Sodexo SA and Vente Unique positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Sodexo SA position performs unexpectedly, Vente Unique 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 Vente Unique will offset losses from the drop in Vente Unique's long position.| Sodexo SA vs. Accor S A | Sodexo SA vs. Publicis Groupe SA | Sodexo SA vs. Legrand SA | Sodexo SA vs. Pernod Ricard SA |
| Vente Unique vs. Piscines Desjoyaux SA | Vente Unique vs. Groupe LDLC SA | Vente Unique vs. Centrale dAchat Franaise | Vente Unique vs. Akwel 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 Sync Your Broker module to sync your existing holdings, watchlists, positions or portfolios from thousands of online brokerage services, banks, investment account aggregators and robo-advisors..
Other Complementary Tools
| Competition Analyzer Analyze and compare many basic indicators for a group of related or unrelated entities | |
| Idea Optimizer Use advanced portfolio builder with pre-computed micro ideas to build optimal portfolio | |
| Portfolio Rebalancing Analyze risk-adjusted returns against different time horizons to find asset-allocation targets | |
| Global Correlations Find global opportunities by holding instruments from different markets | |
| Portfolio Optimization Compute new portfolio that will generate highest expected return given your specified tolerance for risk |