Correlation Between Television Francaise and Vivendi SA
Can any of the company-specific risk be diversified away by investing in both Television Francaise and Vivendi SA 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 Television Francaise and Vivendi SA into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Television Francaise 1 and Vivendi SA, you can compare the effects of market volatilities on Television Francaise and Vivendi SA 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 Television Francaise with a short position of Vivendi SA. Check out your portfolio center. Please also check ongoing floating volatility patterns of Television Francaise and Vivendi SA.
Diversification Opportunities for Television Francaise and Vivendi SA
0.93 | Correlation Coefficient |
Almost no diversification
The 3 months correlation between Television and Vivendi is 0.93. Overlapping area represents the amount of risk that can be diversified away by holding Television Francaise 1 and Vivendi SA in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Vivendi SA and Television Francaise 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 Television Francaise 1 are associated (or correlated) with Vivendi SA. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Vivendi SA has no effect on the direction of Television Francaise i.e., Television Francaise and Vivendi SA go up and down completely randomly.
Pair Corralation between Television Francaise and Vivendi SA
Assuming the 90 days trading horizon Television Francaise 1 is expected to generate 0.86 times more return on investment than Vivendi SA. However, Television Francaise 1 is 1.16 times less risky than Vivendi SA. It trades about -0.13 of its potential returns per unit of risk. Vivendi SA is currently generating about -0.18 per unit of risk. If you would invest 798.00 in Television Francaise 1 on September 2, 2024 and sell it today you would lose (74.00) from holding Television Francaise 1 or give up 9.27% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Television Francaise 1 vs. Vivendi SA
Performance |
| Timeline |
| Television Francaise |
| Vivendi SA |
Television Francaise and Vivendi SA Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Television Francaise and Vivendi SA
The main advantage of trading using opposite Television Francaise and Vivendi SA positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Television Francaise position performs unexpectedly, Vivendi SA 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 Vivendi SA will offset losses from the drop in Vivendi SA's long position.| Television Francaise vs. Mtropole Tlvision SA | Television Francaise vs. Lagardere SCA | Television Francaise vs. Bouygues SA | Television Francaise vs. Publicis Groupe SA |
| Vivendi SA vs. Vinci SA | Vivendi SA vs. Compagnie de Saint Gobain | Vivendi SA vs. Bouygues SA | Vivendi SA vs. Carrefour 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 Fundamental Analysis module to view fundamental data based on most recent published financial statements.
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