Correlation Between Malteries Franco and Genfit

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

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

Diversification Opportunities for Malteries Franco and Genfit

-0.69

Correlation Coefficient

Malteries Franco  Genfit

Excellent diversification

The 3 months correlation between Malteries and Genfit is -0.69. Overlapping area represents the amount of risk that can be diversified away by holding Malteries Franco Belges Socit and Genfit in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Genfit and Malteries Franco 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 Malteries Franco Belges Socit are associated (or correlated) with Genfit. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Genfit has no effect on the direction of Malteries Franco i.e., Malteries Franco and Genfit go up and down completely randomly.

Pair Corralation between Malteries Franco and Genfit

Assuming the 90 days trading horizon Malteries Franco Belges Socit is expected to generate 0.51 times more return on investment than Genfit. However, Malteries Franco Belges Socit is 1.95 times less risky than Genfit. It trades about 0.09 of its potential returns per unit of risk. Genfit is currently generating about 0.03 per unit of risk. If you would invest  57,123  in Malteries Franco Belges Socit on October 5, 2024 and sell it today you would earn a total of  27,377  from holding Malteries Franco Belges Socit or generate 47.93% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Against
Strength	Weak
Accuracy	96.49%
Values	Daily Returns

Malteries Franco Belges Socit  vs.  Genfit

Malteries Franco Belges

Risk-Adjusted Performance

22 of 100

Solid

Compared to the overall equity markets, risk-adjusted returns on investments in Malteries Franco Belges Socit are ranked lower than 22 (%) of all global equities and portfolios over the last 90 days. Despite somewhat weak basic indicators, Malteries Franco sustained solid returns over the last few months and may actually be approaching a breakup point.

Genfit

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Genfit has generated negative risk-adjusted returns adding no value to investors with long positions. Despite weak performance in the last few months, the Stock's basic indicators remain somewhat strong which may send shares a bit higher in February 2025. The current disturbance may also be a sign of long term up-swing for the company investors.

Pair Trading with Malteries Franco and Genfit

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

The idea behind Malteries Franco Belges Socit and Genfit 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 Volatility Analysis module to get historical volatility and risk analysis based on latest market data.