Correlation Between VIEL Cie and Fleury Michon
Can any of the company-specific risk be diversified away by investing in both VIEL Cie and Fleury Michon 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 VIEL Cie and Fleury Michon into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between VIEL Cie socit and Fleury Michon, you can compare the effects of market volatilities on VIEL Cie and Fleury Michon 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 VIEL Cie with a short position of Fleury Michon. Check out your portfolio center. Please also check ongoing floating volatility patterns of VIEL Cie and Fleury Michon.
Diversification Opportunities for VIEL Cie and Fleury Michon
-0.43 | Correlation Coefficient |
Very good diversification
The 3 months correlation between VIEL and Fleury is -0.43. Overlapping area represents the amount of risk that can be diversified away by holding VIEL Cie socit and Fleury Michon in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Fleury Michon and VIEL Cie 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 VIEL Cie socit are associated (or correlated) with Fleury Michon. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Fleury Michon has no effect on the direction of VIEL Cie i.e., VIEL Cie and Fleury Michon go up and down completely randomly.
Pair Corralation between VIEL Cie and Fleury Michon
Assuming the 90 days trading horizon VIEL Cie socit is expected to generate 0.34 times more return on investment than Fleury Michon. However, VIEL Cie socit is 2.96 times less risky than Fleury Michon. It trades about 0.06 of its potential returns per unit of risk. Fleury Michon is currently generating about -0.06 per unit of risk. If you would invest 1,190 in VIEL Cie socit on November 28, 2024 and sell it today you would earn a total of 10.00 from holding VIEL Cie socit or generate 0.84% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
VIEL Cie socit vs. Fleury Michon
Performance |
| Timeline |
| VIEL Cie socit |
| Fleury Michon |
VIEL Cie and Fleury Michon Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with VIEL Cie and Fleury Michon
The main advantage of trading using opposite VIEL Cie and Fleury Michon positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if VIEL Cie position performs unexpectedly, Fleury Michon 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 Fleury Michon will offset losses from the drop in Fleury Michon's long position.The idea behind VIEL Cie socit and Fleury Michon pairs trading is to make the combined position market-neutral, meaning the overall market's direction will not affect its win or loss (or potential downside or upside). This can be achieved by designing a pairs trade with two highly correlated stocks or equities that operate in a similar space or sector, making it possible to obtain profits through simple and relatively low-risk investment.| Fleury Michon vs. Savencia SA | Fleury Michon vs. Bonduelle SCA | Fleury Michon vs. Laurent Perrier | Fleury Michon vs. Vicat 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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