Correlation Between Gaztransport Technigaz and Odyssee Technologies

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

By analyzing existing cross correlation between Gaztransport Technigaz SAS and Odyssee Technologies SA, you can compare the effects of market volatilities on Gaztransport Technigaz and Odyssee Technologies 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 Gaztransport Technigaz with a short position of Odyssee Technologies. Check out your portfolio center. Please also check ongoing floating volatility patterns of Gaztransport Technigaz and Odyssee Technologies.

Diversification Opportunities for Gaztransport Technigaz and Odyssee Technologies

0.18

Correlation Coefficient

Gaztransport Technigaz  Odyssee Technologies

Average diversification

The 3 months correlation between Gaztransport and Odyssee is 0.18. Overlapping area represents the amount of risk that can be diversified away by holding Gaztransport Technigaz SAS and Odyssee Technologies SA in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Odyssee Technologies and Gaztransport Technigaz 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 Gaztransport Technigaz SAS are associated (or correlated) with Odyssee Technologies. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Odyssee Technologies has no effect on the direction of Gaztransport Technigaz i.e., Gaztransport Technigaz and Odyssee Technologies go up and down completely randomly.

Pair Corralation between Gaztransport Technigaz and Odyssee Technologies

Assuming the 90 days trading horizon Gaztransport Technigaz SAS is expected to generate 1.11 times more return on investment than Odyssee Technologies. However, Gaztransport Technigaz is 1.11 times more volatile than Odyssee Technologies SA. It trades about 0.41 of its potential returns per unit of risk. Odyssee Technologies SA is currently generating about 0.3 per unit of risk. If you would invest  12,800  in Gaztransport Technigaz SAS on October 23, 2024 and sell it today you would earn a total of  1,650  from holding Gaztransport Technigaz SAS or generate 12.89% return on investment over 90 days.

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

Gaztransport Technigaz SAS  vs.  Odyssee Technologies SA

Gaztransport Technigaz

Risk-Adjusted Performance

11 of 100

Good

Compared to the overall equity markets, risk-adjusted returns on investments in Gaztransport Technigaz SAS are ranked lower than 11 (%) of all global equities and portfolios over the last 90 days. Despite somewhat weak basic indicators, Gaztransport Technigaz sustained solid returns over the last few months and may actually be approaching a breakup point.

Odyssee Technologies

Risk-Adjusted Performance

1 of 100

Very Weak

Compared to the overall equity markets, risk-adjusted returns on investments in Odyssee Technologies SA are ranked lower than 1 (%) of all global equities and portfolios over the last 90 days. Even with relatively invariable basic indicators, Odyssee Technologies is not utilizing all of its potentials. The current stock price agitation, may contribute to short-term losses for the retail investors.

Pair Trading with Gaztransport Technigaz and Odyssee Technologies

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

The idea behind Gaztransport Technigaz SAS and Odyssee Technologies SA 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.