Correlation Between Ageas SANV and Floridienne

Can any of the company-specific risk be diversified away by investing in both Ageas SANV and Floridienne 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 Ageas SANV and Floridienne into the same portfolio, which is an essential part of the fundamental portfolio management process.

By analyzing existing cross correlation between ageas SANV and Floridienne, you can compare the effects of market volatilities on Ageas SANV and Floridienne 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 Ageas SANV with a short position of Floridienne. Check out your portfolio center. Please also check ongoing floating volatility patterns of Ageas SANV and Floridienne.

Diversification Opportunities for Ageas SANV and Floridienne

0.0

Correlation Coefficient

Ageas SANV  Floridienne

Pay attention - limited upside

The 3 months correlation between Ageas and Floridienne is 0.0. Overlapping area represents the amount of risk that can be diversified away by holding ageas SANV and Floridienne in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Floridienne and Ageas SANV 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 ageas SANV are associated (or correlated) with Floridienne. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Floridienne has no effect on the direction of Ageas SANV i.e., Ageas SANV and Floridienne go up and down completely randomly.

Pair Corralation between Ageas SANV and Floridienne

Assuming the 90 days trading horizon ageas SANV is expected to under-perform the Floridienne. But the stock apears to be less risky and, when comparing its historical volatility, ageas SANV is 2.91 times less risky than Floridienne. The stock trades about -0.08 of its potential returns per unit of risk. The Floridienne is currently generating about 0.27 of returns per unit of risk over similar time horizon. If you would invest  56,000  in Floridienne on September 22, 2024 and sell it today you would earn a total of  9,500  from holding Floridienne or generate 16.96% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Flat
Strength	Insignificant
Accuracy	100.0%
Values	Daily Returns

ageas SANV  vs.  Floridienne

ageas SANV

Risk-Adjusted Performance

1 of 100

Weak

Compared to the overall equity markets, risk-adjusted returns on investments in ageas SANV are ranked lower than 1 (%) of all global equities and portfolios over the last 90 days. Even with relatively invariable basic indicators, Ageas SANV is not utilizing all of its potentials. The latest stock price agitation, may contribute to short-term losses for the retail investors.

Floridienne

Risk-Adjusted Performance

2 of 100

Weak

Compared to the overall equity markets, risk-adjusted returns on investments in Floridienne are ranked lower than 2 (%) of all global equities and portfolios over the last 90 days. Even with relatively invariable basic indicators, Floridienne is not utilizing all of its potentials. The latest stock price agitation, may contribute to short-term losses for the retail investors.

Pair Trading with Ageas SANV and Floridienne

The main advantage of trading using opposite Ageas SANV and Floridienne positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Ageas SANV position performs unexpectedly, Floridienne 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 Floridienne will offset losses from the drop in Floridienne's long position.

The idea behind ageas SANV and Floridienne 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.

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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 My Watchlist Analysis module to analyze my current watchlist and to refresh optimization strategy. Macroaxis watchlist is based on self-learning algorithm to remember stocks you like.