Correlation Between G III and Genfit

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

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

Diversification Opportunities for G III and Genfit

0.32

Correlation Coefficient

G III  Genfit

Weak diversification

The 3 months correlation between GIII and Genfit is 0.32. Overlapping area represents the amount of risk that can be diversified away by holding G III Apparel Group and Genfit in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Genfit and G III 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 G III Apparel Group are associated (or correlated) with Genfit. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Genfit has no effect on the direction of G III i.e., G III and Genfit go up and down completely randomly.

Pair Corralation between G III and Genfit

Given the investment horizon of 90 days G III Apparel Group is expected to under-perform the Genfit. But the stock apears to be less risky and, when comparing its historical volatility, G III Apparel Group is 1.69 times less risky than Genfit. The stock trades about -0.19 of its potential returns per unit of risk. The Genfit is currently generating about 0.0 of returns per unit of risk over similar time horizon. If you would invest  379.00  in Genfit on December 18, 2024 and sell it today you would lose (15.00) from holding Genfit or give up 3.96% of portfolio value over 90 days.

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

G III Apparel Group  vs.  Genfit

G III Apparel

Risk-Adjusted Performance

Very Weak

Over the last 90 days G III Apparel Group has generated negative risk-adjusted returns adding no value to investors with long positions. Despite unfluctuating performance in the last few months, the Stock's forward indicators remain fairly strong which may send shares a bit higher in April 2025. The recent confusion may also be a sign of long-lasting up-swing for the firm traders.

Genfit

Risk-Adjusted Performance

Very Weak

Over the last 90 days Genfit has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of comparatively stable technical and fundamental indicators, Genfit is not utilizing all of its potentials. The newest stock price uproar, may contribute to short-horizon losses for the private investors.

Pair Trading with G III and Genfit

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

The idea behind G III Apparel Group and Genfit 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 Portfolio Rebalancing module to analyze risk-adjusted returns against different time horizons to find asset-allocation targets.