Correlation Between Cogra 48 and Tonnellerie Francois

Can any of the company-specific risk be diversified away by investing in both Cogra 48 and Tonnellerie Francois 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 Cogra 48 and Tonnellerie Francois into the same portfolio, which is an essential part of the fundamental portfolio management process.

By analyzing existing cross correlation between Cogra 48 Socit and Tonnellerie Francois Freres, you can compare the effects of market volatilities on Cogra 48 and Tonnellerie Francois 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 Cogra 48 with a short position of Tonnellerie Francois. Check out your portfolio center. Please also check ongoing floating volatility patterns of Cogra 48 and Tonnellerie Francois.

Diversification Opportunities for Cogra 48 and Tonnellerie Francois

0.73

Correlation Coefficient

Cogra 48  Tonnellerie Francois

Poor diversification

The 3 months correlation between Cogra and Tonnellerie is 0.73. Overlapping area represents the amount of risk that can be diversified away by holding Cogra 48 Socit and Tonnellerie Francois Freres in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Tonnellerie Francois and Cogra 48 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 Cogra 48 Socit are associated (or correlated) with Tonnellerie Francois. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Tonnellerie Francois has no effect on the direction of Cogra 48 i.e., Cogra 48 and Tonnellerie Francois go up and down completely randomly.

Pair Corralation between Cogra 48 and Tonnellerie Francois

Assuming the 90 days trading horizon Cogra 48 Socit is expected to generate 1.16 times more return on investment than Tonnellerie Francois. However, Cogra 48 is 1.16 times more volatile than Tonnellerie Francois Freres. It trades about -0.01 of its potential returns per unit of risk. Tonnellerie Francois Freres is currently generating about -0.12 per unit of risk. If you would invest  584.00  in Cogra 48 Socit on October 13, 2024 and sell it today you would lose (4.00) from holding Cogra 48 Socit or give up 0.68% of portfolio value over 90 days.

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

Cogra 48 Socit  vs.  Tonnellerie Francois Freres

Cogra 48 Socit

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Cogra 48 Socit has generated negative risk-adjusted returns adding no value to investors with long positions. Even with latest weak performance, the Stock's basic indicators remain invariable and the latest agitation on Wall Street may also be a sign of long-running gains for the enterprise retail investors.

Tonnellerie Francois

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Tonnellerie Francois Freres has generated negative risk-adjusted returns adding no value to investors with long positions. Despite latest weak performance, the Stock's technical and fundamental indicators remain strong and the current disturbance on Wall Street may also be a sign of long term gains for the company investors.

Pair Trading with Cogra 48 and Tonnellerie Francois

The main advantage of trading using opposite Cogra 48 and Tonnellerie Francois positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Cogra 48 position performs unexpectedly, Tonnellerie Francois 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 Tonnellerie Francois will offset losses from the drop in Tonnellerie Francois' long position.

The idea behind Cogra 48 Socit and Tonnellerie Francois Freres 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 Pair Correlation module to compare performance and examine fundamental relationship between any two equity instruments.