Correlation Between Amundi SA and Financiere Marjos

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

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

Diversification Opportunities for Amundi SA and Financiere Marjos

-0.37

Correlation Coefficient

Amundi SA  Financiere Marjos

Very good diversification

The 3 months correlation between Amundi and Financiere is -0.37. Overlapping area represents the amount of risk that can be diversified away by holding Amundi SA and Financiere Marjos SA in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Financiere Marjos and Amundi SA 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 Amundi SA are associated (or correlated) with Financiere Marjos. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Financiere Marjos has no effect on the direction of Amundi SA i.e., Amundi SA and Financiere Marjos go up and down completely randomly.

Pair Corralation between Amundi SA and Financiere Marjos

Assuming the 90 days trading horizon Amundi SA is expected to generate 0.19 times more return on investment than Financiere Marjos. However, Amundi SA is 5.23 times less risky than Financiere Marjos. It trades about 0.21 of its potential returns per unit of risk. Financiere Marjos SA is currently generating about -0.04 per unit of risk. If you would invest  6,400  in Amundi SA on December 25, 2024 and sell it today you would earn a total of  1,095  from holding Amundi SA or generate 17.11% return on investment over 90 days.

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

Amundi SA  vs.  Financiere Marjos SA

Amundi SA

Risk-Adjusted Performance

Solid

Compared to the overall equity markets, risk-adjusted returns on investments in Amundi SA are ranked lower than 16 (%) of all global equities and portfolios over the last 90 days. Despite somewhat weak basic indicators, Amundi SA sustained solid returns over the last few months and may actually be approaching a breakup point.

Financiere Marjos

Risk-Adjusted Performance

Very Weak

Over the last 90 days Financiere Marjos SA 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 basic indicators remain somewhat strong which may send shares a bit higher in April 2025. The current disturbance may also be a sign of long term up-swing for the company investors.

Pair Trading with Amundi SA and Financiere Marjos

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

The idea behind Amundi SA and Financiere Marjos 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.

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 Volatility Analysis module to get historical volatility and risk analysis based on latest market data.