Correlation Between Celyad SA and Groep Brussel

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

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

Diversification Opportunities for Celyad SA and Groep Brussel

-0.48

Correlation Coefficient

Celyad SA  Groep Brussel

Very good diversification

The 3 months correlation between Celyad and Groep is -0.48. Overlapping area represents the amount of risk that can be diversified away by holding Celyad SA and Groep Brussel Lambert in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Groep Brussel Lambert and Celyad 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 Celyad SA are associated (or correlated) with Groep Brussel. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Groep Brussel Lambert has no effect on the direction of Celyad SA i.e., Celyad SA and Groep Brussel go up and down completely randomly.

Pair Corralation between Celyad SA and Groep Brussel

Assuming the 90 days trading horizon Celyad SA is expected to generate 16.19 times more return on investment than Groep Brussel. However, Celyad SA is 16.19 times more volatile than Groep Brussel Lambert. It trades about 0.09 of its potential returns per unit of risk. Groep Brussel Lambert is currently generating about 0.0 per unit of risk. If you would invest  26.00  in Celyad SA on December 1, 2024 and sell it today you would earn a total of  26.00  from holding Celyad SA or generate 100.0% return on investment over 90 days.

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

Celyad SA  vs.  Groep Brussel Lambert

Celyad SA

Risk-Adjusted Performance

Very Weak

Over the last 90 days Celyad SA has generated negative risk-adjusted returns adding no value to investors with long positions. Even with latest weak performance, the Stock's basic indicators remain invariable and the latest agitation on Wall Street may also be a sign of long-running gains for the enterprise retail investors.

Groep Brussel Lambert

Risk-Adjusted Performance

OK

Compared to the overall equity markets, risk-adjusted returns on investments in Groep Brussel Lambert are ranked lower than 7 (%) of all global equities and portfolios over the last 90 days. Even with relatively invariable basic indicators, Groep Brussel is not utilizing all of its potentials. The latest stock price agitation, may contribute to short-term losses for the retail investors.

Pair Trading with Celyad SA and Groep Brussel

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

The idea behind Celyad SA and Groep Brussel Lambert 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 Watchlist Optimization module to optimize watchlists to build efficient portfolios or rebalance existing positions based on the mean-variance optimization algorithm.