Correlation Between ABIVAX Société and Cisco Systems

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

By analyzing existing cross correlation between ABIVAX Socit Anonyme and Cisco Systems, you can compare the effects of market volatilities on ABIVAX Société and Cisco Systems 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 ABIVAX Société with a short position of Cisco Systems. Check out your portfolio center. Please also check ongoing floating volatility patterns of ABIVAX Société and Cisco Systems.

Diversification Opportunities for ABIVAX Société and Cisco Systems

0.0

Correlation Coefficient

ABIVAX Société  Cisco Systems

Pay attention - limited upside

The 3 months correlation between ABIVAX and Cisco is 0.0. Overlapping area represents the amount of risk that can be diversified away by holding ABIVAX Socit Anonyme and Cisco Systems in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Cisco Systems and ABIVAX Société 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 ABIVAX Socit Anonyme are associated (or correlated) with Cisco Systems. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Cisco Systems has no effect on the direction of ABIVAX Société i.e., ABIVAX Société and Cisco Systems go up and down completely randomly.

Pair Corralation between ABIVAX Société and Cisco Systems

If you would invest  4,968  in Cisco Systems on September 1, 2024 and sell it today you would earn a total of  953.00  from holding Cisco Systems or generate 19.18% return on investment over 90 days.

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

ABIVAX Socit Anonyme  vs.  Cisco Systems

ABIVAX Socit Anonyme

Risk-Adjusted Performance

0 of 100

Very Weak

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

Cisco Systems

Risk-Adjusted Performance

21 of 100

Solid

Compared to the overall equity markets, risk-adjusted returns on investments in Cisco Systems are ranked lower than 21 (%) of all global equities and portfolios over the last 90 days. In spite of very conflicting fundamental indicators, Cisco Systems displayed solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with ABIVAX Société and Cisco Systems

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

The idea behind ABIVAX Socit Anonyme and Cisco Systems 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 Sign In To Macroaxis module to sign in to explore Macroaxis' wealth optimization platform and fintech modules.