Correlation Between Groupama Entreprises and SIVERS SEMICONDUCTORS

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

By analyzing existing cross correlation between Groupama Entreprises N and SIVERS SEMICONDUCTORS AB, you can compare the effects of market volatilities on Groupama Entreprises and SIVERS SEMICONDUCTORS 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 Groupama Entreprises with a short position of SIVERS SEMICONDUCTORS. Check out your portfolio center. Please also check ongoing floating volatility patterns of Groupama Entreprises and SIVERS SEMICONDUCTORS.

Diversification Opportunities for Groupama Entreprises and SIVERS SEMICONDUCTORS

-0.76

Correlation Coefficient

Groupama Entreprises  SIVERS SEMICONDUCTORS

Pay attention - limited upside

The 3 months correlation between Groupama and SIVERS is -0.76. Overlapping area represents the amount of risk that can be diversified away by holding Groupama Entreprises N and SIVERS SEMICONDUCTORS AB in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on SIVERS SEMICONDUCTORS and Groupama Entreprises 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 Groupama Entreprises N are associated (or correlated) with SIVERS SEMICONDUCTORS. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of SIVERS SEMICONDUCTORS has no effect on the direction of Groupama Entreprises i.e., Groupama Entreprises and SIVERS SEMICONDUCTORS go up and down completely randomly.

Pair Corralation between Groupama Entreprises and SIVERS SEMICONDUCTORS

Assuming the 90 days trading horizon Groupama Entreprises is expected to generate 7.74 times less return on investment than SIVERS SEMICONDUCTORS. But when comparing it to its historical volatility, Groupama Entreprises N is 737.23 times less risky than SIVERS SEMICONDUCTORS. It trades about 0.94 of its potential returns per unit of risk. SIVERS SEMICONDUCTORS AB is currently generating about 0.01 of returns per unit of risk over similar time horizon. If you would invest  33.00  in SIVERS SEMICONDUCTORS AB on October 5, 2024 and sell it today you would lose (7.00) from holding SIVERS SEMICONDUCTORS AB or give up 21.21% of portfolio value over 90 days.

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

Groupama Entreprises N  vs.  SIVERS SEMICONDUCTORS AB

Groupama Entreprises

Risk-Adjusted Performance

0 of 100

Market Crasher

Over the last 90 days Groupama Entreprises N has generated negative risk-adjusted returns adding no value to fund investors. Despite somewhat strong basic indicators, Groupama Entreprises is not utilizing all of its potentials. The current stock price disturbance, may contribute to short-term losses for the investors.

SIVERS SEMICONDUCTORS

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days SIVERS SEMICONDUCTORS AB has generated negative risk-adjusted returns adding no value to investors with long positions. Despite nearly stable basic indicators, SIVERS SEMICONDUCTORS is not utilizing all of its potentials. The current stock price disturbance, may contribute to mid-run losses for the stockholders.

Pair Trading with Groupama Entreprises and SIVERS SEMICONDUCTORS

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

The idea behind Groupama Entreprises N and SIVERS SEMICONDUCTORS AB 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 Balance Of Power module to check stock momentum by analyzing Balance Of Power indicator and other technical ratios.