Correlation Between Bollore SA and Maison Antoine

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

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

Diversification Opportunities for Bollore SA and Maison Antoine

-0.45

Correlation Coefficient

Bollore SA  Maison Antoine

Very good diversification

The 3 months correlation between Bollore and Maison is -0.45. Overlapping area represents the amount of risk that can be diversified away by holding Bollore SA and Maison Antoine Baud in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Maison Antoine Baud and Bollore 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 Bollore SA are associated (or correlated) with Maison Antoine. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Maison Antoine Baud has no effect on the direction of Bollore SA i.e., Bollore SA and Maison Antoine go up and down completely randomly.

Pair Corralation between Bollore SA and Maison Antoine

Assuming the 90 days trading horizon Bollore SA is expected to under-perform the Maison Antoine. But the stock apears to be less risky and, when comparing its historical volatility, Bollore SA is 1.83 times less risky than Maison Antoine. The stock trades about -0.07 of its potential returns per unit of risk. The Maison Antoine Baud is currently generating about 0.15 of returns per unit of risk over similar time horizon. If you would invest  23,200  in Maison Antoine Baud on December 30, 2024 and sell it today you would earn a total of  4,800  from holding Maison Antoine Baud or generate 20.69% return on investment over 90 days.

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

Bollore SA  vs.  Maison Antoine Baud

Bollore SA

Risk-Adjusted Performance

Very Weak

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

Maison Antoine Baud

Risk-Adjusted Performance

Good

Compared to the overall equity markets, risk-adjusted returns on investments in Maison Antoine Baud are ranked lower than 11 (%) of all global equities and portfolios over the last 90 days. Even with relatively weak basic indicators, Maison Antoine reported solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with Bollore SA and Maison Antoine

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

The idea behind Bollore SA and Maison Antoine Baud 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 Bollinger Bands module to use Bollinger Bands indicator to analyze target price for a given investing horizon.