Correlation Between ACTEOS SA and Intrasense

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

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

Diversification Opportunities for ACTEOS SA and Intrasense

0.48

Correlation Coefficient

ACTEOS SA  Intrasense

Very weak diversification

The 3 months correlation between ACTEOS and Intrasense is 0.48. Overlapping area represents the amount of risk that can be diversified away by holding ACTEOS SA and Intrasense in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Intrasense and ACTEOS 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 ACTEOS SA are associated (or correlated) with Intrasense. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Intrasense has no effect on the direction of ACTEOS SA i.e., ACTEOS SA and Intrasense go up and down completely randomly.

Pair Corralation between ACTEOS SA and Intrasense

Assuming the 90 days trading horizon ACTEOS SA is expected to under-perform the Intrasense. But the stock apears to be less risky and, when comparing its historical volatility, ACTEOS SA is 1.07 times less risky than Intrasense. The stock trades about -0.14 of its potential returns per unit of risk. The Intrasense is currently generating about -0.06 of returns per unit of risk over similar time horizon. If you would invest  28.00  in Intrasense on October 1, 2024 and sell it today you would lose (4.00) from holding Intrasense or give up 14.29% of portfolio value over 90 days.

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

ACTEOS SA  vs.  Intrasense

ACTEOS SA

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days ACTEOS SA has generated negative risk-adjusted returns adding no value to investors with long positions. Despite weak performance in the last few months, the Stock's basic indicators remain somewhat strong which may send shares a bit higher in January 2025. The current disturbance may also be a sign of long term up-swing for the company investors.

Intrasense

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Intrasense has generated negative risk-adjusted returns adding no value to investors with long positions. Even with latest weak performance, the Stock's basic indicators remain invariable and the latest agitation on Wall Street may also be a sign of long-running gains for the enterprise retail investors.

Pair Trading with ACTEOS SA and Intrasense

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

The idea behind ACTEOS SA and Intrasense 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 Comparator module to compare the composition, asset allocations and performance of any two portfolios in your account.