Correlation Between Primoris Services and ALTICE

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

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

Diversification Opportunities for Primoris Services and ALTICE

0.68

Correlation Coefficient

Primoris Services  ALTICE

Poor diversification

The 3 months correlation between Primoris and ALTICE is 0.68. Overlapping area represents the amount of risk that can be diversified away by holding Primoris Services and ALTICE FRANCE S in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on ALTICE FRANCE S and Primoris Services 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 Primoris Services are associated (or correlated) with ALTICE. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of ALTICE FRANCE S has no effect on the direction of Primoris Services i.e., Primoris Services and ALTICE go up and down completely randomly.

Pair Corralation between Primoris Services and ALTICE

Given the investment horizon of 90 days Primoris Services is expected to generate 1.37 times more return on investment than ALTICE. However, Primoris Services is 1.37 times more volatile than ALTICE FRANCE S. It trades about 0.25 of its potential returns per unit of risk. ALTICE FRANCE S is currently generating about 0.03 per unit of risk. If you would invest  5,394  in Primoris Services on September 12, 2024 and sell it today you would earn a total of  2,560  from holding Primoris Services or generate 47.45% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Together
Strength	Significant
Accuracy	59.38%
Values	Daily Returns

Primoris Services  vs.  ALTICE FRANCE S

Primoris Services

Risk-Adjusted Performance

19 of 100

Solid

Compared to the overall equity markets, risk-adjusted returns on investments in Primoris Services are ranked lower than 19 (%) of all global equities and portfolios over the last 90 days. In spite of very fragile forward indicators, Primoris Services displayed solid returns over the last few months and may actually be approaching a breakup point.

ALTICE FRANCE S

Risk-Adjusted Performance

2 of 100

Very Weak

Compared to the overall equity markets, risk-adjusted returns on investments in ALTICE FRANCE S are ranked lower than 2 (%) of all global equities and portfolios over the last 90 days. Despite somewhat strong basic indicators, ALTICE is not utilizing all of its potentials. The current stock price disturbance, may contribute to short-term losses for the investors.

Pair Trading with Primoris Services and ALTICE

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

The idea behind Primoris Services and ALTICE FRANCE S 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 Companies Directory module to evaluate performance of over 100,000 Stocks, Funds, and ETFs against different fundamentals.