Correlation Between ACHETER-LOUER and CyberAgent

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

By analyzing existing cross correlation between ACHETER LOUER EO 145612 and CyberAgent, you can compare the effects of market volatilities on ACHETER-LOUER and CyberAgent 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 ACHETER-LOUER with a short position of CyberAgent. Check out your portfolio center. Please also check ongoing floating volatility patterns of ACHETER-LOUER and CyberAgent.

Diversification Opportunities for ACHETER-LOUER and CyberAgent

-0.45

Correlation Coefficient

ACHETER-LOUER  CyberAgent

Very good diversification

The 3 months correlation between ACHETER-LOUER and CyberAgent is -0.45. Overlapping area represents the amount of risk that can be diversified away by holding ACHETER LOUER EO 145612 and CyberAgent in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on CyberAgent and ACHETER-LOUER 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 ACHETER LOUER EO 145612 are associated (or correlated) with CyberAgent. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of CyberAgent has no effect on the direction of ACHETER-LOUER i.e., ACHETER-LOUER and CyberAgent go up and down completely randomly.

Pair Corralation between ACHETER-LOUER and CyberAgent

Assuming the 90 days horizon ACHETER LOUER EO 145612 is expected to under-perform the CyberAgent. In addition to that, ACHETER-LOUER is 15.88 times more volatile than CyberAgent. It trades about -0.11 of its total potential returns per unit of risk. CyberAgent is currently generating about -0.39 per unit of volatility. If you would invest  715.00  in CyberAgent on October 14, 2024 and sell it today you would lose (65.00) from holding CyberAgent or give up 9.09% of portfolio value over 90 days.

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

ACHETER LOUER EO 145612  vs.  CyberAgent

ACHETER LOUER EO

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days ACHETER LOUER EO 145612 has generated negative risk-adjusted returns adding no value to investors with long positions. Despite unsteady performance in the last few months, the Stock's basic indicators remain nearly stable which may send shares a bit higher in February 2025. The current disturbance may also be a sign of long-run up-swing for the company stockholders.

CyberAgent

Risk-Adjusted Performance

0 of 100

Very Weak

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

Pair Trading with ACHETER-LOUER and CyberAgent

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

The idea behind ACHETER LOUER EO 145612 and CyberAgent 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 Sectors module to list of equity sectors categorizing publicly traded companies based on their primary business activities.