Correlation Between Groupe Pizzorno and Marie Brizard

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

By analyzing existing cross correlation between Groupe Pizzorno Environnement and Marie Brizard Wine, you can compare the effects of market volatilities on Groupe Pizzorno and Marie Brizard 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 Groupe Pizzorno with a short position of Marie Brizard. Check out your portfolio center. Please also check ongoing floating volatility patterns of Groupe Pizzorno and Marie Brizard.

Diversification Opportunities for Groupe Pizzorno and Marie Brizard

0.23

Correlation Coefficient

Groupe Pizzorno  Marie Brizard

Modest diversification

The 3 months correlation between Groupe and Marie is 0.23. Overlapping area represents the amount of risk that can be diversified away by holding Groupe Pizzorno Environnement and Marie Brizard Wine in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Marie Brizard Wine and Groupe Pizzorno 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 Groupe Pizzorno Environnement are associated (or correlated) with Marie Brizard. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Marie Brizard Wine has no effect on the direction of Groupe Pizzorno i.e., Groupe Pizzorno and Marie Brizard go up and down completely randomly.

Pair Corralation between Groupe Pizzorno and Marie Brizard

Assuming the 90 days trading horizon Groupe Pizzorno Environnement is expected to under-perform the Marie Brizard. In addition to that, Groupe Pizzorno is 1.29 times more volatile than Marie Brizard Wine. It trades about -0.25 of its total potential returns per unit of risk. Marie Brizard Wine is currently generating about -0.09 per unit of volatility. If you would invest  388.00  in Marie Brizard Wine on September 26, 2024 and sell it today you would lose (6.00) from holding Marie Brizard Wine or give up 1.55% of portfolio value over 90 days.

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

Groupe Pizzorno Environnement  vs.  Marie Brizard Wine

Groupe Pizzorno Envi

Risk-Adjusted Performance

1 of 100

Weak

Compared to the overall equity markets, risk-adjusted returns on investments in Groupe Pizzorno Environnement are ranked lower than 1 (%) of all global equities and portfolios over the last 90 days. Despite somewhat strong technical and fundamental indicators, Groupe Pizzorno is not utilizing all of its potentials. The current stock price disturbance, may contribute to short-term losses for the investors.

Marie Brizard Wine

Risk-Adjusted Performance

4 of 100

Insignificant

Compared to the overall equity markets, risk-adjusted returns on investments in Marie Brizard Wine are ranked lower than 4 (%) of all global equities and portfolios over the last 90 days. Despite somewhat strong basic indicators, Marie Brizard is not utilizing all of its potentials. The current stock price disturbance, may contribute to short-term losses for the investors.

Pair Trading with Groupe Pizzorno and Marie Brizard

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

The idea behind Groupe Pizzorno Environnement and Marie Brizard Wine 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 Price Exposure Probability module to analyze equity upside and downside potential for a given time horizon across multiple markets.