Correlation Between Maisons Du and Samse SA

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

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

Diversification Opportunities for Maisons Du and Samse SA

0.35

Correlation Coefficient

Maisons Du  Samse SA

Weak diversification

The 3 months correlation between Maisons and Samse is 0.35. Overlapping area represents the amount of risk that can be diversified away by holding Maisons du Monde and Samse SA in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Samse SA and Maisons Du 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 Maisons du Monde are associated (or correlated) with Samse SA. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Samse SA has no effect on the direction of Maisons Du i.e., Maisons Du and Samse SA go up and down completely randomly.

Pair Corralation between Maisons Du and Samse SA

Assuming the 90 days trading horizon Maisons du Monde is expected to under-perform the Samse SA. In addition to that, Maisons Du is 1.79 times more volatile than Samse SA. It trades about -0.25 of its total potential returns per unit of risk. Samse SA is currently generating about 0.03 per unit of volatility. If you would invest  14,300  in Samse SA on December 27, 2024 and sell it today you would earn a total of  300.00  from holding Samse SA or generate 2.1% return on investment over 90 days.

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

Maisons du Monde  vs.  Samse SA

Maisons du Monde

Risk-Adjusted Performance

Very Weak

Over the last 90 days Maisons du Monde 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 primary 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.

Samse SA

Risk-Adjusted Performance

Weak

Compared to the overall equity markets, risk-adjusted returns on investments in Samse SA are ranked lower than 2 (%) of all global equities and portfolios over the last 90 days. Despite somewhat strong basic indicators, Samse 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 Maisons Du and Samse SA

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

The idea behind Maisons du Monde and Samse 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 Price Ceiling Movement module to calculate and plot Price Ceiling Movement for different equity instruments.