Correlation Between Air Liquide and Haydale Graphene
Can any of the company-specific risk be diversified away by investing in both Air Liquide and Haydale Graphene 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 Air Liquide and Haydale Graphene into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Air Liquide SA and Haydale Graphene Industries, you can compare the effects of market volatilities on Air Liquide and Haydale Graphene 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 Air Liquide with a short position of Haydale Graphene. Check out your portfolio center. Please also check ongoing floating volatility patterns of Air Liquide and Haydale Graphene.
Diversification Opportunities for Air Liquide and Haydale Graphene
-0.44 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Air and Haydale is -0.44. Overlapping area represents the amount of risk that can be diversified away by holding Air Liquide SA and Haydale Graphene Industries in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Haydale Graphene Ind and Air Liquide 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 Air Liquide SA are associated (or correlated) with Haydale Graphene. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Haydale Graphene Ind has no effect on the direction of Air Liquide i.e., Air Liquide and Haydale Graphene go up and down completely randomly.
Pair Corralation between Air Liquide and Haydale Graphene
Assuming the 90 days horizon Air Liquide SA is expected to generate 0.1 times more return on investment than Haydale Graphene. However, Air Liquide SA is 9.66 times less risky than Haydale Graphene. It trades about 0.23 of its potential returns per unit of risk. Haydale Graphene Industries is currently generating about 0.02 per unit of risk. If you would invest 3,211 in Air Liquide SA on December 28, 2024 and sell it today you would earn a total of 578.00 from holding Air Liquide SA or generate 18.0% return on investment over 90 days.
Time Period | 3 Months [change] |
Direction | Moves Against |
Strength | Very Weak |
Accuracy | 100.0% |
Values | Daily Returns |
Air Liquide SA vs. Haydale Graphene Industries
Performance |
Timeline |
Air Liquide SA |
Haydale Graphene Ind |
Air Liquide and Haydale Graphene Volatility Contrast
Predicted Return Density |
Returns |
Pair Trading with Air Liquide and Haydale Graphene
The main advantage of trading using opposite Air Liquide and Haydale Graphene positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Air Liquide position performs unexpectedly, Haydale Graphene 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 Haydale Graphene will offset losses from the drop in Haydale Graphene's long position.Air Liquide vs. Asia Carbon Industries | Air Liquide vs. Akzo Nobel NV | Air Liquide vs. Avoca LLC | Air Liquide vs. AGC Inc ADR |
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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 Aroon Oscillator module to analyze current equity momentum using Aroon Oscillator and other momentum ratios.
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