Correlation Between Samse SA and Lucibel

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

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

Diversification Opportunities for Samse SA and Lucibel

0.11

Correlation Coefficient

Samse SA  Lucibel

Average diversification

The 3 months correlation between Samse and Lucibel is 0.11. Overlapping area represents the amount of risk that can be diversified away by holding Samse SA and Lucibel in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Lucibel and Samse SA 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 Samse SA are associated (or correlated) with Lucibel. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Lucibel has no effect on the direction of Samse SA i.e., Samse SA and Lucibel go up and down completely randomly.

Pair Corralation between Samse SA and Lucibel

Assuming the 90 days trading horizon Samse SA is expected to generate 4.23 times less return on investment than Lucibel. But when comparing it to its historical volatility, Samse SA is 6.46 times less risky than Lucibel. It trades about 0.03 of its potential returns per unit of risk. Lucibel is currently generating about 0.02 of returns per unit of risk over similar time horizon. If you would invest  11.00  in Lucibel on December 30, 2024 and sell it today you would lose (1.21) from holding Lucibel or give up 11.0% of portfolio value over 90 days.

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

Samse SA  vs.  Lucibel

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.

Lucibel

Risk-Adjusted Performance

Weak

Compared to the overall equity markets, risk-adjusted returns on investments in Lucibel are ranked lower than 1 (%) of all global equities and portfolios over the last 90 days. Even with relatively weak basic indicators, Lucibel may actually be approaching a critical reversion point that can send shares even higher in April 2025.

Pair Trading with Samse SA and Lucibel

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

The idea behind Samse SA and Lucibel 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 Bond Analysis module to evaluate and analyze corporate bonds as a potential investment for your portfolios..