Correlation Between Vente Unique and Moulinvest

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

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

Diversification Opportunities for Vente Unique and Moulinvest

0.23

Correlation Coefficient

Vente Unique  Moulinvest

Modest diversification

The 3 months correlation between Vente and Moulinvest is 0.23. Overlapping area represents the amount of risk that can be diversified away by holding Vente Unique and Moulinvest in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Moulinvest and Vente Unique 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 Vente Unique are associated (or correlated) with Moulinvest. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Moulinvest has no effect on the direction of Vente Unique i.e., Vente Unique and Moulinvest go up and down completely randomly.

Pair Corralation between Vente Unique and Moulinvest

Assuming the 90 days trading horizon Vente Unique is expected to generate 1.17 times more return on investment than Moulinvest. However, Vente Unique is 1.17 times more volatile than Moulinvest. It trades about 0.02 of its potential returns per unit of risk. Moulinvest is currently generating about -0.18 per unit of risk. If you would invest  1,295  in Vente Unique on September 4, 2024 and sell it today you would earn a total of  15.00  from holding Vente Unique or generate 1.16% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Together
Strength	Very Weak
Accuracy	100.0%
Values	Daily Returns

Vente Unique  vs.  Moulinvest

Vente Unique

Risk-Adjusted Performance

1 of 100

Very Weak

Compared to the overall equity markets, risk-adjusted returns on investments in Vente Unique are ranked lower than 1 (%) of all global equities and portfolios over the last 90 days. Despite somewhat strong basic indicators, Vente Unique is not utilizing all of its potentials. The latest stock price disturbance, may contribute to short-term losses for the investors.

Moulinvest

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Moulinvest has generated negative risk-adjusted returns adding no value to investors with long positions. Even with weak performance in the last few months, the Stock's basic indicators remain relatively invariable which may send shares a bit higher in January 2025. The latest agitation may also be a sign of long-running up-swing for the enterprise retail investors.

Pair Trading with Vente Unique and Moulinvest

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

The idea behind Vente Unique and Moulinvest 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 Bond Analysis module to evaluate and analyze corporate bonds as a potential investment for your portfolios..