Correlation Between Mtropole Tlvision and SCOR SE

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

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

Diversification Opportunities for Mtropole Tlvision and SCOR SE

0.92

Correlation Coefficient

Mtropole Tlvision  SCOR SE

Almost no diversification

The 3 months correlation between Mtropole and SCOR is 0.92. Overlapping area represents the amount of risk that can be diversified away by holding Mtropole Tlvision SA and SCOR SE in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on SCOR SE and Mtropole Tlvision 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 Mtropole Tlvision SA are associated (or correlated) with SCOR SE. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of SCOR SE has no effect on the direction of Mtropole Tlvision i.e., Mtropole Tlvision and SCOR SE go up and down completely randomly.

Pair Corralation between Mtropole Tlvision and SCOR SE

Assuming the 90 days trading horizon Mtropole Tlvision SA is expected to generate 0.68 times more return on investment than SCOR SE. However, Mtropole Tlvision SA is 1.47 times less risky than SCOR SE. It trades about 0.39 of its potential returns per unit of risk. SCOR SE is currently generating about 0.18 per unit of risk. If you would invest  1,110  in Mtropole Tlvision SA on December 30, 2024 and sell it today you would earn a total of  302.00  from holding Mtropole Tlvision SA or generate 27.21% return on investment over 90 days.

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

Mtropole Tlvision SA  vs.  SCOR SE

Mtropole Tlvision

Risk-Adjusted Performance

Very Strong

Compared to the overall equity markets, risk-adjusted returns on investments in Mtropole Tlvision SA are ranked lower than 30 (%) of all global equities and portfolios over the last 90 days. Despite somewhat weak basic indicators, Mtropole Tlvision sustained solid returns over the last few months and may actually be approaching a breakup point.

SCOR SE

Risk-Adjusted Performance

Good

Compared to the overall equity markets, risk-adjusted returns on investments in SCOR SE are ranked lower than 14 (%) of all global equities and portfolios over the last 90 days. Despite somewhat weak basic indicators, SCOR SE sustained solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with Mtropole Tlvision and SCOR SE

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

The idea behind Mtropole Tlvision SA and SCOR SE 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 Portfolio Suggestion module to get suggestions outside of your existing asset allocation including your own model portfolios.