Correlation Between Immobiliere Dassault and Patrimoine

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Can any of the company-specific risk be diversified away by investing in both Immobiliere Dassault and Patrimoine 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 Immobiliere Dassault and Patrimoine into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Immobiliere Dassault SA and Patrimoine et Commerce, you can compare the effects of market volatilities on Immobiliere Dassault and Patrimoine 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 Immobiliere Dassault with a short position of Patrimoine. Check out your portfolio center. Please also check ongoing floating volatility patterns of Immobiliere Dassault and Patrimoine.

Diversification Opportunities for Immobiliere Dassault and Patrimoine

-0.28
  Correlation Coefficient

Very good diversification

The 3 months correlation between Immobiliere and Patrimoine is -0.28. Overlapping area represents the amount of risk that can be diversified away by holding Immobiliere Dassault SA and Patrimoine et Commerce in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Patrimoine et Commerce and Immobiliere Dassault 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 Immobiliere Dassault SA are associated (or correlated) with Patrimoine. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Patrimoine et Commerce has no effect on the direction of Immobiliere Dassault i.e., Immobiliere Dassault and Patrimoine go up and down completely randomly.

Pair Corralation between Immobiliere Dassault and Patrimoine

Assuming the 90 days trading horizon Immobiliere Dassault SA is expected to generate 1.92 times more return on investment than Patrimoine. However, Immobiliere Dassault is 1.92 times more volatile than Patrimoine et Commerce. It trades about 0.03 of its potential returns per unit of risk. Patrimoine et Commerce is currently generating about -0.11 per unit of risk. If you would invest  5,180  in Immobiliere Dassault SA on September 12, 2024 and sell it today you would earn a total of  120.00  from holding Immobiliere Dassault SA or generate 2.32% return on investment over 90 days.
Time Period3 Months [change]
DirectionMoves Against 
StrengthInsignificant
Accuracy100.0%
ValuesDaily Returns

Immobiliere Dassault SA  vs.  Patrimoine et Commerce

 Performance 
       Timeline  
Immobiliere Dassault 

Risk-Adjusted Performance

2 of 100

 
Weak
 
Strong
Weak
Compared to the overall equity markets, risk-adjusted returns on investments in Immobiliere Dassault SA are ranked lower than 2 (%) of all global equities and portfolios over the last 90 days. Despite somewhat strong basic indicators, Immobiliere Dassault is not utilizing all of its potentials. The current stock price disturbance, may contribute to short-term losses for the investors.
Patrimoine et Commerce 

Risk-Adjusted Performance

0 of 100

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

Immobiliere Dassault and Patrimoine Volatility Contrast

   Predicted Return Density   
       Returns  

Pair Trading with Immobiliere Dassault and Patrimoine

The main advantage of trading using opposite Immobiliere Dassault and Patrimoine positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Immobiliere Dassault position performs unexpectedly, Patrimoine 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 Patrimoine will offset losses from the drop in Patrimoine's long position.
The idea behind Immobiliere Dassault SA and Patrimoine et Commerce 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 Alpha Finder module to use alpha and beta coefficients to find investment opportunities after accounting for the risk.

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