Correlation Between Ipsos SA and Equifax

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

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

Diversification Opportunities for Ipsos SA and Equifax

0.75

Correlation Coefficient

Ipsos SA  Equifax

Poor diversification

The 3 months correlation between Ipsos and Equifax is 0.75. Overlapping area represents the amount of risk that can be diversified away by holding Ipsos SA and Equifax in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Equifax and Ipsos SA 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 Ipsos SA are associated (or correlated) with Equifax. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Equifax has no effect on the direction of Ipsos SA i.e., Ipsos SA and Equifax go up and down completely randomly.

Pair Corralation between Ipsos SA and Equifax

If you would invest  6,233  in Ipsos SA on September 5, 2024 and sell it today you would earn a total of  0.00  from holding Ipsos SA or generate 0.0% return on investment over 90 days.

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

Ipsos SA  vs.  Equifax

Ipsos SA

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Ipsos SA has generated negative risk-adjusted returns adding no value to investors with long positions. Despite nearly stable basic indicators, Ipsos SA is not utilizing all of its potentials. The current stock price disturbance, may contribute to mid-run losses for the stockholders.

Equifax

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Equifax has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of latest conflicting performance, the Stock's technical and fundamental indicators remain strong and the current disturbance on Wall Street may also be a sign of long term gains for the company investors.

Pair Trading with Ipsos SA and Equifax

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

The idea behind Ipsos SA and Equifax 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 File Import module to quickly import all of your third-party portfolios from your local drive in csv format.