Correlation Between Vivendi SA and SES S
Can any of the company-specific risk be diversified away by investing in both Vivendi SA and SES S 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 Vivendi SA and SES S into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Vivendi SA and SES S A, you can compare the effects of market volatilities on Vivendi SA and SES S 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 Vivendi SA with a short position of SES S. Check out your portfolio center. Please also check ongoing floating volatility patterns of Vivendi SA and SES S.
Diversification Opportunities for Vivendi SA and SES S
0.75 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Vivendi and SES is 0.75. Overlapping area represents the amount of risk that can be diversified away by holding Vivendi SA and SES S A in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on SES S A and Vivendi 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 Vivendi SA are associated (or correlated) with SES S. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of SES S A has no effect on the direction of Vivendi SA i.e., Vivendi SA and SES S go up and down completely randomly.
Pair Corralation between Vivendi SA and SES S
Assuming the 90 days trading horizon Vivendi SA is expected to generate 0.82 times more return on investment than SES S. However, Vivendi SA is 1.22 times less risky than SES S. It trades about -0.08 of its potential returns per unit of risk. SES S A is currently generating about -0.17 per unit of risk. If you would invest 1,020 in Vivendi SA on September 1, 2024 and sell it today you would lose (151.00) from holding Vivendi SA or give up 14.8% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 99.24% |
| Values | Daily Returns |
Vivendi SA vs. SES S A
Performance |
| Timeline |
| Vivendi SA |
| SES S A |
Vivendi SA and SES S Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Vivendi SA and SES S
The main advantage of trading using opposite Vivendi SA and SES S positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Vivendi SA position performs unexpectedly, SES S 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 SES S will offset losses from the drop in SES S's long position.| 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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