Correlation Between Believe SAS and OVH Groupe

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

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

Diversification Opportunities for Believe SAS and OVH Groupe

-0.71

Correlation Coefficient

Believe SAS  OVH Groupe

Pay attention - limited upside

The 3 months correlation between Believe and OVH is -0.71. Overlapping area represents the amount of risk that can be diversified away by holding Believe SAS and OVH Groupe SAS in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on OVH Groupe SAS and Believe 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 Believe SAS are associated (or correlated) with OVH Groupe. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of OVH Groupe SAS has no effect on the direction of Believe SAS i.e., Believe SAS and OVH Groupe go up and down completely randomly.

Pair Corralation between Believe SAS and OVH Groupe

Assuming the 90 days trading horizon Believe SAS is expected to generate 0.59 times more return on investment than OVH Groupe. However, Believe SAS is 1.69 times less risky than OVH Groupe. It trades about 0.11 of its potential returns per unit of risk. OVH Groupe SAS is currently generating about -0.07 per unit of risk. If you would invest  1,378  in Believe SAS on December 26, 2024 and sell it today you would earn a total of  130.00  from holding Believe SAS or generate 9.43% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Against
Strength	Weak
Accuracy	98.41%
Values	Daily Returns

Believe SAS  vs.  OVH Groupe SAS

Believe SAS

Risk-Adjusted Performance

OK

Compared to the overall equity markets, risk-adjusted returns on investments in Believe SAS are ranked lower than 8 (%) of all global equities and portfolios over the last 90 days. Despite somewhat weak basic indicators, Believe SAS may actually be approaching a critical reversion point that can send shares even higher in April 2025.

OVH Groupe SAS

Risk-Adjusted Performance

Very Weak

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

Pair Trading with Believe SAS and OVH Groupe

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

The idea behind Believe SAS and OVH Groupe SAS 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 Companies Directory module to evaluate performance of over 100,000 Stocks, Funds, and ETFs against different fundamentals.