Correlation Between Genfit SA and Brockhaus Capital
Can any of the company-specific risk be diversified away by investing in both Genfit SA and Brockhaus Capital 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 Genfit SA and Brockhaus Capital into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Genfit SA and Brockhaus Capital Management, you can compare the effects of market volatilities on Genfit SA and Brockhaus Capital 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 Genfit SA with a short position of Brockhaus Capital. Check out your portfolio center. Please also check ongoing floating volatility patterns of Genfit SA and Brockhaus Capital.
Diversification Opportunities for Genfit SA and Brockhaus Capital
0.65 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Genfit and Brockhaus is 0.65. Overlapping area represents the amount of risk that can be diversified away by holding Genfit SA and Brockhaus Capital Management in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Brockhaus Capital and Genfit 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 Genfit SA are associated (or correlated) with Brockhaus Capital. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Brockhaus Capital has no effect on the direction of Genfit SA i.e., Genfit SA and Brockhaus Capital go up and down completely randomly.
Pair Corralation between Genfit SA and Brockhaus Capital
Assuming the 90 days trading horizon Genfit SA is expected to under-perform the Brockhaus Capital. But the stock apears to be less risky and, when comparing its historical volatility, Genfit SA is 1.62 times less risky than Brockhaus Capital. The stock trades about -0.45 of its potential returns per unit of risk. The Brockhaus Capital Management is currently generating about 0.0 of returns per unit of risk over similar time horizon. If you would invest 2,360 in Brockhaus Capital Management on September 20, 2024 and sell it today you would lose (10.00) from holding Brockhaus Capital Management or give up 0.42% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 95.65% |
| Values | Daily Returns |
Genfit SA vs. Brockhaus Capital Management
Performance |
| Timeline |
| Genfit SA |
| Brockhaus Capital |
Genfit SA and Brockhaus Capital Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Genfit SA and Brockhaus Capital
The main advantage of trading using opposite Genfit SA and Brockhaus Capital positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Genfit SA position performs unexpectedly, Brockhaus Capital 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 Brockhaus Capital will offset losses from the drop in Brockhaus Capital's long position.| Genfit SA vs. BORR DRILLING NEW | Genfit SA vs. Brockhaus Capital Management | Genfit SA vs. FIREWEED METALS P | Genfit SA vs. Major Drilling Group |
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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 Idea Optimizer module to use advanced portfolio builder with pre-computed micro ideas to build optimal portfolio .
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