Correlation Between Bnteau SA and Ramsay Generale

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

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

Diversification Opportunities for Bnteau SA and Ramsay Generale

-0.29

Correlation Coefficient

Bnteau SA  Ramsay Generale

Very good diversification

The 3 months correlation between Bnteau and Ramsay is -0.29. Overlapping area represents the amount of risk that can be diversified away by holding Bnteau SA and Ramsay Generale De in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Ramsay Generale De and Bnteau 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 Bnteau SA are associated (or correlated) with Ramsay Generale. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Ramsay Generale De has no effect on the direction of Bnteau SA i.e., Bnteau SA and Ramsay Generale go up and down completely randomly.

Pair Corralation between Bnteau SA and Ramsay Generale

Assuming the 90 days trading horizon Bnteau SA is expected to under-perform the Ramsay Generale. In addition to that, Bnteau SA is 1.27 times more volatile than Ramsay Generale De. It trades about -0.64 of its total potential returns per unit of risk. Ramsay Generale De is currently generating about -0.3 per unit of volatility. If you would invest  1,320  in Ramsay Generale De on August 30, 2024 and sell it today you would lose (150.00) from holding Ramsay Generale De or give up 11.36% of portfolio value over 90 days.

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

Bnteau SA  vs.  Ramsay Generale De

Bnteau SA

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Bnteau SA has generated negative risk-adjusted returns adding no value to investors with long positions. Despite latest weak performance, the Stock's basic indicators remain strong and the current disturbance on Wall Street may also be a sign of long term gains for the company investors.

Ramsay Generale De

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Ramsay Generale De 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 December 2024. The current disturbance may also be a sign of long term up-swing for the company investors.

Pair Trading with Bnteau SA and Ramsay Generale

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

The idea behind Bnteau SA and Ramsay Generale De 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 Instant Ratings module to determine any equity ratings based on digital recommendations. Macroaxis instant equity ratings are based on combination of fundamental analysis and risk-adjusted market performance.