Correlation Between Piscines Desjoyaux and Gecina SA

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

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

Diversification Opportunities for Piscines Desjoyaux and Gecina SA

0.48

Correlation Coefficient

Piscines Desjoyaux  Gecina SA

Very weak diversification

The 3 months correlation between Piscines and Gecina is 0.48. Overlapping area represents the amount of risk that can be diversified away by holding Piscines Desjoyaux SA and Gecina SA in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Gecina SA and Piscines Desjoyaux 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 Piscines Desjoyaux SA are associated (or correlated) with Gecina SA. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Gecina SA has no effect on the direction of Piscines Desjoyaux i.e., Piscines Desjoyaux and Gecina SA go up and down completely randomly.

Pair Corralation between Piscines Desjoyaux and Gecina SA

Assuming the 90 days trading horizon Piscines Desjoyaux SA is expected to generate 1.33 times more return on investment than Gecina SA. However, Piscines Desjoyaux is 1.33 times more volatile than Gecina SA. It trades about 0.25 of its potential returns per unit of risk. Gecina SA is currently generating about -0.02 per unit of risk. If you would invest  1,220  in Piscines Desjoyaux SA on December 1, 2024 and sell it today you would earn a total of  330.00  from holding Piscines Desjoyaux SA or generate 27.05% return on investment over 90 days.

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

Piscines Desjoyaux SA  vs.  Gecina SA

Piscines Desjoyaux

Risk-Adjusted Performance

Solid

Compared to the overall equity markets, risk-adjusted returns on investments in Piscines Desjoyaux SA are ranked lower than 19 (%) of all global equities and portfolios over the last 90 days. Even with relatively weak basic indicators, Piscines Desjoyaux reported solid returns over the last few months and may actually be approaching a breakup point.

Gecina SA

Risk-Adjusted Performance

Very Weak

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

Pair Trading with Piscines Desjoyaux and Gecina SA

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

The idea behind Piscines Desjoyaux SA and Gecina 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 Global Markets Map module to get a quick overview of global market snapshot using zoomable world map. Drill down to check world indexes.