Correlation Between Riber SA and Damartex

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

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

Diversification Opportunities for Riber SA and Damartex

-0.11

Correlation Coefficient

Riber SA  Damartex

Good diversification

The 3 months correlation between Riber and Damartex is -0.11. Overlapping area represents the amount of risk that can be diversified away by holding Riber SA and Damartex in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Damartex and Riber 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 Riber SA are associated (or correlated) with Damartex. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Damartex has no effect on the direction of Riber SA i.e., Riber SA and Damartex go up and down completely randomly.

Pair Corralation between Riber SA and Damartex

Assuming the 90 days trading horizon Riber SA is expected to generate 0.84 times more return on investment than Damartex. However, Riber SA is 1.18 times less risky than Damartex. It trades about 0.06 of its potential returns per unit of risk. Damartex is currently generating about -0.05 per unit of risk. If you would invest  158.00  in Riber SA on September 24, 2024 and sell it today you would earn a total of  115.00  from holding Riber SA or generate 72.78% return on investment over 90 days.

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

Riber SA  vs.  Damartex

Riber SA

Risk-Adjusted Performance

4 of 100

Insignificant

Compared to the overall equity markets, risk-adjusted returns on investments in Riber SA are ranked lower than 4 (%) of all global equities and portfolios over the last 90 days. Even with relatively weak basic indicators, Riber SA may actually be approaching a critical reversion point that can send shares even higher in January 2025.

Damartex

Risk-Adjusted Performance

3 of 100

OK

Compared to the overall equity markets, risk-adjusted returns on investments in Damartex are ranked lower than 3 (%) of all global equities and portfolios over the last 90 days. Even with relatively weak basic indicators, Damartex may actually be approaching a critical reversion point that can send shares even higher in January 2025.

Pair Trading with Riber SA and Damartex

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

The idea behind Riber SA and Damartex 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 Money Managers module to screen money managers from public funds and ETFs managed around the world.