Correlation Between Marie Brizard and Stef SA

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

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

Diversification Opportunities for Marie Brizard and Stef SA

-0.88

Correlation Coefficient

Marie Brizard  Stef SA

Pay attention - limited upside

The 3 months correlation between Marie and Stef is -0.88. Overlapping area represents the amount of risk that can be diversified away by holding Marie Brizard Wine and Stef SA in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Stef SA and Marie Brizard 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 Marie Brizard Wine are associated (or correlated) with Stef SA. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Stef SA has no effect on the direction of Marie Brizard i.e., Marie Brizard and Stef SA go up and down completely randomly.

Pair Corralation between Marie Brizard and Stef SA

Assuming the 90 days trading horizon Marie Brizard Wine is expected to under-perform the Stef SA. In addition to that, Marie Brizard is 1.49 times more volatile than Stef SA. It trades about -0.13 of its total potential returns per unit of risk. Stef SA is currently generating about 0.09 per unit of volatility. If you would invest  12,800  in Stef SA on December 2, 2024 and sell it today you would earn a total of  780.00  from holding Stef SA or generate 6.09% return on investment over 90 days.

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

Marie Brizard Wine  vs.  Stef SA

Marie Brizard Wine

Risk-Adjusted Performance

Very Weak

Over the last 90 days Marie Brizard Wine 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 April 2025. The current disturbance may also be a sign of long term up-swing for the company investors.

Stef SA

Risk-Adjusted Performance

OK

Compared to the overall equity markets, risk-adjusted returns on investments in Stef SA are ranked lower than 7 (%) of all global equities and portfolios over the last 90 days. Despite somewhat strong technical and fundamental indicators, Stef SA is not utilizing all of its potentials. The current stock price disturbance, may contribute to short-term losses for the investors.

Pair Trading with Marie Brizard and Stef SA

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

The idea behind Marie Brizard Wine and Stef 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 Sign In To Macroaxis module to sign in to explore Macroaxis' wealth optimization platform and fintech modules.