Correlation Between Grolleau SAS and Hydrogene

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

By analyzing existing cross correlation between Grolleau SAS and Hydrogene De France, you can compare the effects of market volatilities on Grolleau SAS and Hydrogene 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 Grolleau SAS with a short position of Hydrogene. Check out your portfolio center. Please also check ongoing floating volatility patterns of Grolleau SAS and Hydrogene.

Diversification Opportunities for Grolleau SAS and Hydrogene

0.21

Correlation Coefficient

Grolleau SAS  Hydrogene

Modest diversification

The 3 months correlation between Grolleau and Hydrogene is 0.21. Overlapping area represents the amount of risk that can be diversified away by holding Grolleau SAS and Hydrogene De France in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Hydrogene De France and Grolleau SAS 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 Grolleau SAS are associated (or correlated) with Hydrogene. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Hydrogene De France has no effect on the direction of Grolleau SAS i.e., Grolleau SAS and Hydrogene go up and down completely randomly.

Pair Corralation between Grolleau SAS and Hydrogene

Assuming the 90 days trading horizon Grolleau SAS is expected to generate 0.84 times more return on investment than Hydrogene. However, Grolleau SAS is 1.2 times less risky than Hydrogene. It trades about -0.05 of its potential returns per unit of risk. Hydrogene De France is currently generating about -0.1 per unit of risk. If you would invest  438.00  in Grolleau SAS on October 7, 2024 and sell it today you would lose (58.00) from holding Grolleau SAS or give up 13.24% of portfolio value over 90 days.

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

Grolleau SAS  vs.  Hydrogene De France

Grolleau SAS

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Grolleau SAS 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.

Hydrogene De France

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Hydrogene De France has generated negative risk-adjusted returns adding no value to investors with long positions. Despite weak performance in the last few months, the Stock's technical and fundamental indicators remain somewhat strong which may send shares a bit higher in February 2025. The current disturbance may also be a sign of long term up-swing for the company investors.

Pair Trading with Grolleau SAS and Hydrogene

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

The idea behind Grolleau SAS and Hydrogene De France 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 Cryptocurrency Center module to build and monitor diversified portfolio of extremely risky digital assets and cryptocurrency.