Correlation Between Jacques Bogart and Poxel SA

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

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

Diversification Opportunities for Jacques Bogart and Poxel SA

0.07

Correlation Coefficient

Jacques Bogart  Poxel SA

Significant diversification

The 3 months correlation between Jacques and Poxel is 0.07. Overlapping area represents the amount of risk that can be diversified away by holding Jacques Bogart SA and Poxel SA in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Poxel SA and Jacques Bogart 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 Jacques Bogart SA are associated (or correlated) with Poxel SA. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Poxel SA has no effect on the direction of Jacques Bogart i.e., Jacques Bogart and Poxel SA go up and down completely randomly.

Pair Corralation between Jacques Bogart and Poxel SA

Assuming the 90 days trading horizon Jacques Bogart SA is expected to under-perform the Poxel SA. But the stock apears to be less risky and, when comparing its historical volatility, Jacques Bogart SA is 4.99 times less risky than Poxel SA. The stock trades about -0.05 of its potential returns per unit of risk. The Poxel SA is currently generating about 0.11 of returns per unit of risk over similar time horizon. If you would invest  14.00  in Poxel SA on December 24, 2024 and sell it today you would earn a total of  8.00  from holding Poxel SA or generate 57.14% return on investment over 90 days.

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

Jacques Bogart SA  vs.  Poxel SA

Jacques Bogart SA

Risk-Adjusted Performance

Very Weak

Over the last 90 days Jacques Bogart SA has generated negative risk-adjusted returns adding no value to investors with long positions. Despite latest weak performance, the Stock's basic indicators remain strong and the current disturbance on Wall Street may also be a sign of long term gains for the company investors.

Poxel SA

Risk-Adjusted Performance

OK

Compared to the overall equity markets, risk-adjusted returns on investments in Poxel SA are ranked lower than 8 (%) of all global equities and portfolios over the last 90 days. Even with relatively weak basic indicators, Poxel SA reported solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with Jacques Bogart and Poxel SA

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

The idea behind Jacques Bogart SA and Poxel 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 Performance Analysis module to check effects of mean-variance optimization against your current asset allocation.