Correlation Between FF Global and Amundi Label

Can any of the company-specific risk be diversified away by investing in both FF Global and Amundi Label 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 FF Global and Amundi Label into the same portfolio, which is an essential part of the fundamental portfolio management process.

By analyzing existing cross correlation between FF Global and Amundi Label Actions, you can compare the effects of market volatilities on FF Global and Amundi Label 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 FF Global with a short position of Amundi Label. Check out your portfolio center. Please also check ongoing floating volatility patterns of FF Global and Amundi Label.

Diversification Opportunities for FF Global and Amundi Label

-0.21

Correlation Coefficient

FF Global  Amundi Label

Very good diversification

The 3 months correlation between FJ2P and Amundi is -0.21. Overlapping area represents the amount of risk that can be diversified away by holding FF Global and Amundi Label Actions in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Amundi Label Actions and FF Global 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 FF Global are associated (or correlated) with Amundi Label. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Amundi Label Actions has no effect on the direction of FF Global i.e., FF Global and Amundi Label go up and down completely randomly.

Pair Corralation between FF Global and Amundi Label

Assuming the 90 days trading horizon FF Global is expected to generate 1.06 times less return on investment than Amundi Label. In addition to that, FF Global is 2.09 times more volatile than Amundi Label Actions. It trades about 0.17 of its total potential returns per unit of risk. Amundi Label Actions is currently generating about 0.38 per unit of volatility. If you would invest  29,335  in Amundi Label Actions on September 22, 2024 and sell it today you would earn a total of  1,132  from holding Amundi Label Actions or generate 3.86% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Against
Strength	Insignificant
Accuracy	91.3%
Values	Daily Returns

FF Global  vs.  Amundi Label Actions

FF Global

Risk-Adjusted Performance

13 of 100

Good

Compared to the overall equity markets, risk-adjusted returns on investments in FF Global are ranked lower than 13 (%) of all funds and portfolios of funds over the last 90 days. In spite of rather weak technical and fundamental indicators, FF Global may actually be approaching a critical reversion point that can send shares even higher in January 2025.

Amundi Label Actions

Risk-Adjusted Performance

2 of 100

Weak

Compared to the overall equity markets, risk-adjusted returns on investments in Amundi Label Actions are ranked lower than 2 (%) of all funds and portfolios of funds over the last 90 days. Despite somewhat strong basic indicators, Amundi Label is not utilizing all of its potentials. The latest stock price disturbance, may contribute to short-term losses for the investors.

Pair Trading with FF Global and Amundi Label

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

The idea behind FF Global and Amundi Label Actions 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.

Check out your portfolio center.

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 Money Managers module to screen money managers from public funds and ETFs managed around the world.