Correlation Between Groupe Guillin and Robertet

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

By analyzing existing cross correlation between Groupe Guillin SA and Robertet SA, you can compare the effects of market volatilities on Groupe Guillin and Robertet 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 Groupe Guillin with a short position of Robertet. Check out your portfolio center. Please also check ongoing floating volatility patterns of Groupe Guillin and Robertet.

Diversification Opportunities for Groupe Guillin and Robertet

-0.35

Correlation Coefficient

Groupe Guillin  Robertet

Very good diversification

The 3 months correlation between Groupe and Robertet is -0.35. Overlapping area represents the amount of risk that can be diversified away by holding Groupe Guillin SA and Robertet SA in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Robertet SA and Groupe Guillin 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 Groupe Guillin SA are associated (or correlated) with Robertet. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Robertet SA has no effect on the direction of Groupe Guillin i.e., Groupe Guillin and Robertet go up and down completely randomly.

Pair Corralation between Groupe Guillin and Robertet

Assuming the 90 days trading horizon Groupe Guillin SA is expected to generate 1.68 times more return on investment than Robertet. However, Groupe Guillin is 1.68 times more volatile than Robertet SA. It trades about 0.08 of its potential returns per unit of risk. Robertet SA is currently generating about -0.11 per unit of risk. If you would invest  2,575  in Groupe Guillin SA on December 2, 2024 and sell it today you would earn a total of  185.00  from holding Groupe Guillin SA or generate 7.18% return on investment over 90 days.

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

Groupe Guillin SA  vs.  Robertet SA

Groupe Guillin SA

Risk-Adjusted Performance

Modest

Compared to the overall equity markets, risk-adjusted returns on investments in Groupe Guillin SA are ranked lower than 6 (%) of all global equities and portfolios over the last 90 days. Even with relatively weak basic indicators, Groupe Guillin may actually be approaching a critical reversion point that can send shares even higher in April 2025.

Robertet SA

Risk-Adjusted Performance

Very Weak

Over the last 90 days Robertet SA has generated negative risk-adjusted returns adding no value to investors with long positions. Despite somewhat strong basic indicators, Robertet is not utilizing all of its potentials. The current stock price disturbance, may contribute to short-term losses for the investors.

Pair Trading with Groupe Guillin and Robertet

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

The idea behind Groupe Guillin SA and Robertet 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 Odds Of Bankruptcy module to get analysis of equity chance of financial distress in the next 2 years.