Correlation Between Trigano SA and Icape Holding
Can any of the company-specific risk be diversified away by investing in both Trigano SA and Icape Holding 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 Trigano SA and Icape Holding into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Trigano SA and Icape Holding, you can compare the effects of market volatilities on Trigano SA and Icape Holding 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 Trigano SA with a short position of Icape Holding. Check out your portfolio center. Please also check ongoing floating volatility patterns of Trigano SA and Icape Holding.
Diversification Opportunities for Trigano SA and Icape Holding
-0.87 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between Trigano and Icape is -0.87. Overlapping area represents the amount of risk that can be diversified away by holding Trigano SA and Icape Holding in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Icape Holding and Trigano 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 Trigano SA are associated (or correlated) with Icape Holding. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Icape Holding has no effect on the direction of Trigano SA i.e., Trigano SA and Icape Holding go up and down completely randomly.
Pair Corralation between Trigano SA and Icape Holding
Assuming the 90 days trading horizon Trigano SA is expected to generate 0.65 times more return on investment than Icape Holding. However, Trigano SA is 1.53 times less risky than Icape Holding. It trades about 0.01 of its potential returns per unit of risk. Icape Holding is currently generating about -0.03 per unit of risk. If you would invest 11,749 in Trigano SA on August 28, 2024 and sell it today you would earn a total of 191.00 from holding Trigano SA or generate 1.63% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Trigano SA vs. Icape Holding
Performance |
| Timeline |
| Trigano SA |
| Icape Holding |
Trigano SA and Icape Holding Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Trigano SA and Icape Holding
The main advantage of trading using opposite Trigano SA and Icape Holding positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Trigano SA position performs unexpectedly, Icape Holding 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 Icape Holding will offset losses from the drop in Icape Holding's long position.| Trigano SA vs. Metalliance SA | Trigano SA vs. Veolia Environnement VE | Trigano SA vs. Jacquet Metal Service | Trigano SA vs. Linedata Services SA |
| Icape Holding vs. LVMH Mot Hennessy | Icape Holding vs. LOreal SA | Icape Holding vs. Hermes International SCA | Icape Holding vs. Manitou BF 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 Money Flow Index module to determine momentum by analyzing Money Flow Index and other technical indicators.
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