Correlation Between HAYDALE GRAPHINDUSLS-02 and Air Liquide

Can any of the company-specific risk be diversified away by investing in both HAYDALE GRAPHINDUSLS-02 and Air Liquide 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 HAYDALE GRAPHINDUSLS-02 and Air Liquide into the same portfolio, which is an essential part of the fundamental portfolio management process.

By analyzing existing cross correlation between HAYDALE GRAPHINDUSLS 02 and Air Liquide SA, you can compare the effects of market volatilities on HAYDALE GRAPHINDUSLS-02 and Air Liquide 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 HAYDALE GRAPHINDUSLS-02 with a short position of Air Liquide. Check out your portfolio center. Please also check ongoing floating volatility patterns of HAYDALE GRAPHINDUSLS-02 and Air Liquide.

Diversification Opportunities for HAYDALE GRAPHINDUSLS-02 and Air Liquide

0.39

Correlation Coefficient

HAYDALE GRAPHINDUSLS-02  Air Liquide

Weak diversification

The 3 months correlation between HAYDALE and Air is 0.39. Overlapping area represents the amount of risk that can be diversified away by holding HAYDALE GRAPHINDUSLS 02 and Air Liquide SA in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Air Liquide SA and HAYDALE GRAPHINDUSLS-02 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 HAYDALE GRAPHINDUSLS 02 are associated (or correlated) with Air Liquide. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Air Liquide SA has no effect on the direction of HAYDALE GRAPHINDUSLS-02 i.e., HAYDALE GRAPHINDUSLS-02 and Air Liquide go up and down completely randomly.

Pair Corralation between HAYDALE GRAPHINDUSLS-02 and Air Liquide

Assuming the 90 days horizon HAYDALE GRAPHINDUSLS 02 is expected to generate 130.1 times more return on investment than Air Liquide. However, HAYDALE GRAPHINDUSLS-02 is 130.1 times more volatile than Air Liquide SA. It trades about 0.22 of its potential returns per unit of risk. Air Liquide SA is currently generating about 0.05 per unit of risk. If you would invest  2.20  in HAYDALE GRAPHINDUSLS 02 on October 12, 2024 and sell it today you would lose (2.16) from holding HAYDALE GRAPHINDUSLS 02 or give up 98.18% of portfolio value over 90 days.

Time Period	3 Months [change]
Direction	Moves Together
Strength	Very Weak
Accuracy	99.8%
Values	Daily Returns

HAYDALE GRAPHINDUSLS 02  vs.  Air Liquide SA

HAYDALE GRAPHINDUSLS-02

Risk-Adjusted Performance

19 of 100

Solid

Compared to the overall equity markets, risk-adjusted returns on investments in HAYDALE GRAPHINDUSLS 02 are ranked lower than 19 (%) of all global equities and portfolios over the last 90 days. Despite nearly uncertain basic indicators, HAYDALE GRAPHINDUSLS-02 reported solid returns over the last few months and may actually be approaching a breakup point.

Air Liquide SA

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Air Liquide SA has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of latest uncertain performance, the Stock's essential indicators remain stable and the newest uproar on Wall Street may also be a sign of mid-term gains for the firm private investors.

Pair Trading with HAYDALE GRAPHINDUSLS-02 and Air Liquide

The main advantage of trading using opposite HAYDALE GRAPHINDUSLS-02 and Air Liquide positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if HAYDALE GRAPHINDUSLS-02 position performs unexpectedly, Air Liquide 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 Air Liquide will offset losses from the drop in Air Liquide's long position.

The idea behind HAYDALE GRAPHINDUSLS 02 and Air Liquide 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.

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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 Aroon Oscillator module to analyze current equity momentum using Aroon Oscillator and other momentum ratios.