Correlation Between Samse SA and Vicat SA

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

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

Diversification Opportunities for Samse SA and Vicat SA

-0.47

Correlation Coefficient

Samse SA  Vicat SA

Very good diversification

The 3 months correlation between Samse and Vicat is -0.47. Overlapping area represents the amount of risk that can be diversified away by holding Samse SA and Vicat SA in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Vicat SA 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 Vicat SA. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Vicat SA has no effect on the direction of Samse SA i.e., Samse SA and Vicat SA go up and down completely randomly.

Pair Corralation between Samse SA and Vicat SA

Assuming the 90 days trading horizon Samse SA is expected to under-perform the Vicat SA. In addition to that, Samse SA is 1.11 times more volatile than Vicat SA. It trades about -0.11 of its total potential returns per unit of risk. Vicat SA is currently generating about 0.14 per unit of volatility. If you would invest  3,080  in Vicat SA on September 3, 2024 and sell it today you would earn a total of  500.00  from holding Vicat SA or generate 16.23% return on investment over 90 days.

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

Samse SA  vs.  Vicat SA

Samse SA

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Samse SA 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 January 2025. The current disturbance may also be a sign of long term up-swing for the company investors.

Vicat SA

Risk-Adjusted Performance

11 of 100

Good

Compared to the overall equity markets, risk-adjusted returns on investments in Vicat SA are ranked lower than 11 (%) of all global equities and portfolios over the last 90 days. Despite somewhat weak basic indicators, Vicat SA sustained solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with Samse SA and Vicat SA

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

The idea behind Samse SA and Vicat 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 FinTech Suite module to use AI to screen and filter profitable investment opportunities.