Correlation Between Compagnie Des and Groupimo

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

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

Diversification Opportunities for Compagnie Des and Groupimo

0.0

Correlation Coefficient

Compagnie Des  Groupimo

Pay attention - limited upside

The 3 months correlation between Compagnie and Groupimo is 0.0. Overlapping area represents the amount of risk that can be diversified away by holding Compagnie des Eaux and Groupimo SA in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Groupimo SA and Compagnie Des 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 Compagnie des Eaux are associated (or correlated) with Groupimo. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Groupimo SA has no effect on the direction of Compagnie Des i.e., Compagnie Des and Groupimo go up and down completely randomly.

Pair Corralation between Compagnie Des and Groupimo

If you would invest  20.00  in Groupimo SA on September 14, 2024 and sell it today you would lose (1.00) from holding Groupimo SA or give up 5.0% of portfolio value over 90 days.

Time Period	3 Months [change]
Direction	Flat
Strength	Insignificant
Accuracy	0.0%
Values	Daily Returns

Compagnie des Eaux  vs.  Groupimo SA

Compagnie des Eaux

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Compagnie des Eaux has generated negative risk-adjusted returns adding no value to investors with long positions. Even with relatively invariable basic indicators, Compagnie Des is not utilizing all of its potentials. The current stock price agitation, may contribute to short-term losses for the retail investors.

Groupimo SA

Risk-Adjusted Performance

4 of 100

Insignificant

Compared to the overall equity markets, risk-adjusted returns on investments in Groupimo SA are ranked lower than 4 (%) of all global equities and portfolios over the last 90 days. Even with relatively weak basic indicators, Groupimo reported solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with Compagnie Des and Groupimo

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

The idea behind Compagnie des Eaux and Groupimo SA 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.

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 Stocks Directory module to find actively traded stocks across global markets.