Correlation Between ANTA Sports and CREDIT AGRICOLE

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

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

Diversification Opportunities for ANTA Sports and CREDIT AGRICOLE

0.3

Correlation Coefficient

ANTA Sports  CREDIT AGRICOLE

Weak diversification

The 3 months correlation between ANTA and CREDIT is 0.3. Overlapping area represents the amount of risk that can be diversified away by holding ANTA Sports Products and CREDIT AGRICOLE in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on CREDIT AGRICOLE and ANTA Sports 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 ANTA Sports Products are associated (or correlated) with CREDIT AGRICOLE. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of CREDIT AGRICOLE has no effect on the direction of ANTA Sports i.e., ANTA Sports and CREDIT AGRICOLE go up and down completely randomly.

Pair Corralation between ANTA Sports and CREDIT AGRICOLE

Assuming the 90 days horizon ANTA Sports Products is expected to generate 2.55 times more return on investment than CREDIT AGRICOLE. However, ANTA Sports is 2.55 times more volatile than CREDIT AGRICOLE. It trades about 0.05 of its potential returns per unit of risk. CREDIT AGRICOLE is currently generating about -0.01 per unit of risk. If you would invest  816.00  in ANTA Sports Products on September 24, 2024 and sell it today you would earn a total of  164.00  from holding ANTA Sports Products or generate 20.1% return on investment over 90 days.

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

ANTA Sports Products  vs.  CREDIT AGRICOLE

ANTA Sports Products

Risk-Adjusted Performance

3 of 100

Insignificant

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

CREDIT AGRICOLE

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days CREDIT AGRICOLE has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of latest uncertain performance, the Stock's basic indicators remain stable and the newest uproar on Wall Street may also be a sign of mid-term gains for the firm private investors.

Pair Trading with ANTA Sports and CREDIT AGRICOLE

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

The idea behind ANTA Sports Products and CREDIT AGRICOLE 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 Portfolio Volatility module to check portfolio volatility and analyze historical return density to properly model market risk.