Correlation Between Legends Business and Bureau Veritas

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

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

Diversification Opportunities for Legends Business and Bureau Veritas

0.0

Correlation Coefficient

Legends Business  Bureau Veritas

Pay attention - limited upside

The 3 months correlation between Legends and Bureau is 0.0. Overlapping area represents the amount of risk that can be diversified away by holding Legends Business Grp and Bureau Veritas SA in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Bureau Veritas SA and Legends Business 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 Legends Business Grp are associated (or correlated) with Bureau Veritas. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Bureau Veritas SA has no effect on the direction of Legends Business i.e., Legends Business and Bureau Veritas go up and down completely randomly.

Pair Corralation between Legends Business and Bureau Veritas

If you would invest  0.01  in Legends Business Grp on December 29, 2024 and sell it today you would earn a total of  0.00  from holding Legends Business Grp or generate 0.0% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Flat
Strength	Insignificant
Accuracy	88.52%
Values	Daily Returns

Legends Business Grp  vs.  Bureau Veritas SA

Legends Business Grp

Risk-Adjusted Performance

Very Weak

Over the last 90 days Legends Business Grp has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of comparatively stable fundamental drivers, Legends Business is not utilizing all of its potentials. The latest stock price uproar, may contribute to short-horizon losses for the private investors.

Bureau Veritas SA

Risk-Adjusted Performance

Very Weak

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

Pair Trading with Legends Business and Bureau Veritas

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

The idea behind Legends Business Grp and Bureau Veritas 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.

Check out your portfolio center.

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 Global Markets Map module to get a quick overview of global market snapshot using zoomable world map. Drill down to check world indexes.