Correlation Between SA Catana and Elior SCA

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

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

Diversification Opportunities for SA Catana and Elior SCA

-0.1

Correlation Coefficient

SA Catana  Elior SCA

Good diversification

The 3 months correlation between CATG and Elior is -0.1. Overlapping area represents the amount of risk that can be diversified away by holding SA Catana Group and Elior SCA in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Elior SCA and SA Catana 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 SA Catana Group are associated (or correlated) with Elior SCA. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Elior SCA has no effect on the direction of SA Catana i.e., SA Catana and Elior SCA go up and down completely randomly.

Pair Corralation between SA Catana and Elior SCA

Assuming the 90 days trading horizon SA Catana Group is expected to generate 0.56 times more return on investment than Elior SCA. However, SA Catana Group is 1.8 times less risky than Elior SCA. It trades about 0.04 of its potential returns per unit of risk. Elior SCA is currently generating about -0.09 per unit of risk. If you would invest  473.00  in SA Catana Group on September 14, 2024 and sell it today you would earn a total of  22.00  from holding SA Catana Group or generate 4.65% return on investment over 90 days.

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

SA Catana Group  vs.  Elior SCA

SA Catana Group

Risk-Adjusted Performance

3 of 100

Insignificant

Compared to the overall equity markets, risk-adjusted returns on investments in SA Catana Group are ranked lower than 3 (%) of all global equities and portfolios over the last 90 days. Despite somewhat strong basic indicators, SA Catana is not utilizing all of its potentials. The current stock price disturbance, may contribute to short-term losses for the investors.

Elior SCA

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Elior SCA has generated negative risk-adjusted returns adding no value to investors with long positions. Even with weak performance in the last few months, the Stock's basic indicators remain relatively invariable which may send shares a bit higher in January 2025. The latest agitation may also be a sign of long-running up-swing for the enterprise retail investors.

Pair Trading with SA Catana and Elior SCA

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

The idea behind SA Catana Group and Elior SCA 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 Sync Your Broker module to sync your existing holdings, watchlists, positions or portfolios from thousands of online brokerage services, banks, investment account aggregators and robo-advisors..