Correlation Between Socit Gnrale and COMINTL BANK

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

By analyzing existing cross correlation between Socit Gnrale Socit and COMINTL BANK ADR1, you can compare the effects of market volatilities on Socit Gnrale and COMINTL BANK 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 Socit Gnrale with a short position of COMINTL BANK. Check out your portfolio center. Please also check ongoing floating volatility patterns of Socit Gnrale and COMINTL BANK.

Diversification Opportunities for Socit Gnrale and COMINTL BANK

-0.23

Correlation Coefficient

Socit Gnrale  COMINTL BANK

Very good diversification

The 3 months correlation between Socit and COMINTL is -0.23. Overlapping area represents the amount of risk that can be diversified away by holding Socit Gnrale Socit and COMINTL BANK ADR1 in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on COMINTL BANK ADR1 and Socit Gnrale 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 Socit Gnrale Socit are associated (or correlated) with COMINTL BANK. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of COMINTL BANK ADR1 has no effect on the direction of Socit Gnrale i.e., Socit Gnrale and COMINTL BANK go up and down completely randomly.

Pair Corralation between Socit Gnrale and COMINTL BANK

Assuming the 90 days trading horizon Socit Gnrale is expected to generate 4.04 times less return on investment than COMINTL BANK. In addition to that, Socit Gnrale is 1.09 times more volatile than COMINTL BANK ADR1. It trades about 0.02 of its total potential returns per unit of risk. COMINTL BANK ADR1 is currently generating about 0.07 per unit of volatility. If you would invest  128.00  in COMINTL BANK ADR1 on September 22, 2024 and sell it today you would earn a total of  3.00  from holding COMINTL BANK ADR1 or generate 2.34% return on investment over 90 days.

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

Socit Gnrale Socit  vs.  COMINTL BANK ADR1

Socit Gnrale Socit

Risk-Adjusted Performance

12 of 100

Good

Compared to the overall equity markets, risk-adjusted returns on investments in Socit Gnrale Socit are ranked lower than 12 (%) of all global equities and portfolios over the last 90 days. In spite of comparatively unsteady technical and fundamental indicators, Socit Gnrale unveiled solid returns over the last few months and may actually be approaching a breakup point.

COMINTL BANK ADR1

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days COMINTL BANK ADR1 has generated negative risk-adjusted returns adding no value to investors with long positions. Despite nearly stable basic indicators, COMINTL BANK is not utilizing all of its potentials. The newest stock price disturbance, may contribute to mid-run losses for the stockholders.

Pair Trading with Socit Gnrale and COMINTL BANK

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

The idea behind Socit Gnrale Socit and COMINTL BANK ADR1 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 Portfolio Diagnostics module to use generated alerts and portfolio events aggregator to diagnose current holdings.