Correlation Between Vienna Insurance and Pernod Ricard
Can any of the company-specific risk be diversified away by investing in both Vienna Insurance and Pernod Ricard 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 Vienna Insurance and Pernod Ricard into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Vienna Insurance Group and Pernod Ricard SA, you can compare the effects of market volatilities on Vienna Insurance and Pernod Ricard 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 Vienna Insurance with a short position of Pernod Ricard. Check out your portfolio center. Please also check ongoing floating volatility patterns of Vienna Insurance and Pernod Ricard.
Diversification Opportunities for Vienna Insurance and Pernod Ricard
0.43 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Vienna and Pernod is 0.43. Overlapping area represents the amount of risk that can be diversified away by holding Vienna Insurance Group and Pernod Ricard SA in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Pernod Ricard SA and Vienna Insurance 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 Vienna Insurance Group are associated (or correlated) with Pernod Ricard. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Pernod Ricard SA has no effect on the direction of Vienna Insurance i.e., Vienna Insurance and Pernod Ricard go up and down completely randomly.
Pair Corralation between Vienna Insurance and Pernod Ricard
Assuming the 90 days trading horizon Vienna Insurance Group is expected to generate 0.86 times more return on investment than Pernod Ricard. However, Vienna Insurance Group is 1.17 times less risky than Pernod Ricard. It trades about 0.06 of its potential returns per unit of risk. Pernod Ricard SA is currently generating about -0.06 per unit of risk. If you would invest 2,309 in Vienna Insurance Group on November 5, 2024 and sell it today you would earn a total of 936.00 from holding Vienna Insurance Group or generate 40.54% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Vienna Insurance Group vs. Pernod Ricard SA
Performance |
| Timeline |
| Vienna Insurance |
| Pernod Ricard SA |
Vienna Insurance and Pernod Ricard Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Vienna Insurance and Pernod Ricard
The main advantage of trading using opposite Vienna Insurance and Pernod Ricard positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Vienna Insurance position performs unexpectedly, Pernod Ricard 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 Pernod Ricard will offset losses from the drop in Pernod Ricard's long position.| Vienna Insurance vs. X FAB Silicon Foundries | Vienna Insurance vs. GALENA MINING LTD | Vienna Insurance vs. Ringmetall SE | Vienna Insurance vs. X FAB Silicon Foundries |
| Pernod Ricard vs. Zijin Mining Group | Pernod Ricard vs. VITEC SOFTWARE GROUP | Pernod Ricard vs. PSI Software AG | Pernod Ricard vs. Aya Gold Silver |
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 Share Portfolio module to track or share privately all of your investments from the convenience of any device.
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