Correlation Between SOGECLAIR and Cboe Global

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

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

Diversification Opportunities for SOGECLAIR and Cboe Global

-0.18

Correlation Coefficient

SOGECLAIR  Cboe Global

Good diversification

The 3 months correlation between SOGECLAIR and Cboe is -0.18. Overlapping area represents the amount of risk that can be diversified away by holding SOGECLAIR SA INH and Cboe Global Markets in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Cboe Global Markets and SOGECLAIR 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 SOGECLAIR SA INH are associated (or correlated) with Cboe Global. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Cboe Global Markets has no effect on the direction of SOGECLAIR i.e., SOGECLAIR and Cboe Global go up and down completely randomly.

Pair Corralation between SOGECLAIR and Cboe Global

Assuming the 90 days horizon SOGECLAIR SA INH is expected to generate 1.74 times more return on investment than Cboe Global. However, SOGECLAIR is 1.74 times more volatile than Cboe Global Markets. It trades about 0.19 of its potential returns per unit of risk. Cboe Global Markets is currently generating about 0.08 per unit of risk. If you would invest  1,915  in SOGECLAIR SA INH on December 5, 2024 and sell it today you would earn a total of  225.00  from holding SOGECLAIR SA INH or generate 11.75% return on investment over 90 days.

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

SOGECLAIR SA INH  vs.  Cboe Global Markets

SOGECLAIR SA INH

Risk-Adjusted Performance

OK

Compared to the overall equity markets, risk-adjusted returns on investments in SOGECLAIR SA INH are ranked lower than 9 (%) of all global equities and portfolios over the last 90 days. Despite nearly uncertain basic indicators, SOGECLAIR reported solid returns over the last few months and may actually be approaching a breakup point.

Cboe Global Markets

Risk-Adjusted Performance

Weak

Compared to the overall equity markets, risk-adjusted returns on investments in Cboe Global Markets are ranked lower than 2 (%) of all global equities and portfolios over the last 90 days. Despite nearly stable basic indicators, Cboe Global is not utilizing all of its potentials. The newest stock price disturbance, may contribute to mid-run losses for the stockholders.

Pair Trading with SOGECLAIR and Cboe Global

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

The idea behind SOGECLAIR SA INH and Cboe Global Markets 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 Fundamental Analysis module to view fundamental data based on most recent published financial statements.