Correlation Between Ferm Casino and Caisse Rgionale

Can any of the company-specific risk be diversified away by investing in both Ferm Casino and Caisse Rgionale 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 Ferm Casino and Caisse Rgionale into the same portfolio, which is an essential part of the fundamental portfolio management process.

By analyzing existing cross correlation between Ferm Casino Mun and Caisse rgionale de, you can compare the effects of market volatilities on Ferm Casino and Caisse Rgionale 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 Ferm Casino with a short position of Caisse Rgionale. Check out your portfolio center. Please also check ongoing floating volatility patterns of Ferm Casino and Caisse Rgionale.

Diversification Opportunities for Ferm Casino and Caisse Rgionale

-0.47

Correlation Coefficient

Ferm Casino  Caisse Rgionale

Very good diversification

The 3 months correlation between Ferm and Caisse is -0.47. Overlapping area represents the amount of risk that can be diversified away by holding Ferm Casino Mun and Caisse rgionale de in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Caisse rgionale de and Ferm Casino 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 Ferm Casino Mun are associated (or correlated) with Caisse Rgionale. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Caisse rgionale de has no effect on the direction of Ferm Casino i.e., Ferm Casino and Caisse Rgionale go up and down completely randomly.

Pair Corralation between Ferm Casino and Caisse Rgionale

Assuming the 90 days trading horizon Ferm Casino Mun is expected to under-perform the Caisse Rgionale. In addition to that, Ferm Casino is 2.1 times more volatile than Caisse rgionale de. It trades about -0.01 of its total potential returns per unit of risk. Caisse rgionale de is currently generating about 0.18 per unit of volatility. If you would invest  8,640  in Caisse rgionale de on December 30, 2024 and sell it today you would earn a total of  1,295  from holding Caisse rgionale de or generate 14.99% return on investment over 90 days.

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

Ferm Casino Mun  vs.  Caisse rgionale de

Ferm Casino Mun

Risk-Adjusted Performance

Very Weak

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

Caisse rgionale de

Risk-Adjusted Performance

Good

Compared to the overall equity markets, risk-adjusted returns on investments in Caisse rgionale de are ranked lower than 14 (%) of all global equities and portfolios over the last 90 days. Despite somewhat weak basic indicators, Caisse Rgionale sustained solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with Ferm Casino and Caisse Rgionale

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

The idea behind Ferm Casino Mun and Caisse rgionale 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 Headlines Timeline module to stay connected to all market stories and filter out noise. Drill down to analyze hype elasticity.