Correlation Between Icape Holding and Hydrogene
Can any of the company-specific risk be diversified away by investing in both Icape Holding 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 Icape Holding and Hydrogene into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Icape Holding and Hydrogene De France, you can compare the effects of market volatilities on Icape Holding 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 Icape Holding with a short position of Hydrogene. Check out your portfolio center. Please also check ongoing floating volatility patterns of Icape Holding and Hydrogene.
Diversification Opportunities for Icape Holding and Hydrogene
0.28 | Correlation Coefficient |
Modest diversification
The 3 months correlation between Icape and Hydrogene is 0.28. Overlapping area represents the amount of risk that can be diversified away by holding Icape Holding 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 Icape Holding 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 Icape Holding 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 Icape Holding i.e., Icape Holding and Hydrogene go up and down completely randomly.
Pair Corralation between Icape Holding and Hydrogene
Assuming the 90 days trading horizon Icape Holding is expected to generate 3.59 times more return on investment than Hydrogene. However, Icape Holding is 3.59 times more volatile than Hydrogene De France. It trades about 0.24 of its potential returns per unit of risk. Hydrogene De France is currently generating about 0.03 per unit of risk. If you would invest 746.00 in Icape Holding on October 22, 2024 and sell it today you would earn a total of 184.00 from holding Icape Holding or generate 24.66% return on investment over 90 days.
Time Period | 3 Months [change] |
Direction | Moves Together |
Strength | Very Weak |
Accuracy | 94.74% |
Values | Daily Returns |
Icape Holding vs. Hydrogene De France
Performance |
Timeline |
Icape Holding |
Hydrogene De France |
Icape Holding and Hydrogene Volatility Contrast
Predicted Return Density |
Returns |
Pair Trading with Icape Holding and Hydrogene
The main advantage of trading using opposite Icape Holding and Hydrogene positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Icape Holding 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.Icape Holding vs. Charwood Energy SA | Icape Holding vs. Entech SE SAS | Icape Holding vs. Broadpeak SA | Icape Holding vs. Grard Perrier Industrie |
Hydrogene vs. Hydrogen Refueling Solutions | Hydrogene vs. Lhyfe SA | Hydrogene vs. Neoen SA | Hydrogene vs. Voltalia SA |
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 Headlines Timeline module to stay connected to all market stories and filter out noise. Drill down to analyze hype elasticity.
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