Correlation Between Chargeurs and Bains Mer
Can any of the company-specific risk be diversified away by investing in both Chargeurs and Bains Mer 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 Chargeurs and Bains Mer into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Chargeurs SA and Bains Mer Monaco, you can compare the effects of market volatilities on Chargeurs and Bains Mer 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 Chargeurs with a short position of Bains Mer. Check out your portfolio center. Please also check ongoing floating volatility patterns of Chargeurs and Bains Mer.
Diversification Opportunities for Chargeurs and Bains Mer
Very weak diversification
The 3 months correlation between Chargeurs and Bains is 0.46. Overlapping area represents the amount of risk that can be diversified away by holding Chargeurs SA and Bains Mer Monaco in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Bains Mer Monaco and Chargeurs 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 Chargeurs SA are associated (or correlated) with Bains Mer. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Bains Mer Monaco has no effect on the direction of Chargeurs i.e., Chargeurs and Bains Mer go up and down completely randomly.
Pair Corralation between Chargeurs and Bains Mer
Assuming the 90 days trading horizon Chargeurs SA is expected to generate 1.32 times more return on investment than Bains Mer. However, Chargeurs is 1.32 times more volatile than Bains Mer Monaco. It trades about 0.05 of its potential returns per unit of risk. Bains Mer Monaco is currently generating about -0.06 per unit of risk. If you would invest 995.00 in Chargeurs SA on September 28, 2024 and sell it today you would earn a total of 15.00 from holding Chargeurs SA or generate 1.51% return on investment over 90 days.
Time Period | 3 Months [change] |
Direction | Moves Together |
Strength | Weak |
Accuracy | 100.0% |
Values | Daily Returns |
Chargeurs SA vs. Bains Mer Monaco
Performance |
Timeline |
Chargeurs SA |
Bains Mer Monaco |
Chargeurs and Bains Mer Volatility Contrast
Predicted Return Density |
Returns |
Pair Trading with Chargeurs and Bains Mer
The main advantage of trading using opposite Chargeurs and Bains Mer positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Chargeurs position performs unexpectedly, Bains Mer 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 Bains Mer will offset losses from the drop in Bains Mer's long position.Chargeurs vs. Derichebourg | Chargeurs vs. Trigano SA | Chargeurs vs. Rubis SCA | Chargeurs vs. BigBen Interactive |
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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 Volatility Analysis module to get historical volatility and risk analysis based on latest market data.
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