Correlation Between Sofina Socit and Scheerders Van

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

By analyzing existing cross correlation between Sofina Socit Anonyme and Scheerders van Kerchoves, you can compare the effects of market volatilities on Sofina Socit and Scheerders Van 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 Sofina Socit with a short position of Scheerders Van. Check out your portfolio center. Please also check ongoing floating volatility patterns of Sofina Socit and Scheerders Van.

Diversification Opportunities for Sofina Socit and Scheerders Van

-0.63

Correlation Coefficient

Sofina Socit  Scheerders Van

Excellent diversification

The 3 months correlation between Sofina and Scheerders is -0.63. Overlapping area represents the amount of risk that can be diversified away by holding Sofina Socit Anonyme and Scheerders van Kerchoves in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Scheerders van Kerchoves and Sofina Socit 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 Sofina Socit Anonyme are associated (or correlated) with Scheerders Van. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Scheerders van Kerchoves has no effect on the direction of Sofina Socit i.e., Sofina Socit and Scheerders Van go up and down completely randomly.

Pair Corralation between Sofina Socit and Scheerders Van

Assuming the 90 days trading horizon Sofina Socit Anonyme is expected to under-perform the Scheerders Van. But the stock apears to be less risky and, when comparing its historical volatility, Sofina Socit Anonyme is 4.97 times less risky than Scheerders Van. The stock trades about -0.22 of its potential returns per unit of risk. The Scheerders van Kerchoves is currently generating about 0.11 of returns per unit of risk over similar time horizon. If you would invest  26,000  in Scheerders van Kerchoves on September 12, 2024 and sell it today you would earn a total of  8,200  from holding Scheerders van Kerchoves or generate 31.54% return on investment over 90 days.

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

Sofina Socit Anonyme  vs.  Scheerders van Kerchoves

Sofina Socit Anonyme

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Sofina Socit Anonyme has generated negative risk-adjusted returns adding no value to investors with long positions. Even with weak performance in the last few months, the Stock's technical and fundamental indicators remain relatively invariable which may send shares a bit higher in January 2025. The latest agitation may also be a sign of long-running up-swing for the enterprise retail investors.

Scheerders van Kerchoves

Risk-Adjusted Performance

8 of 100

OK

Compared to the overall equity markets, risk-adjusted returns on investments in Scheerders van Kerchoves are ranked lower than 8 (%) of all global equities and portfolios over the last 90 days. Even with relatively weak basic indicators, Scheerders Van reported solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with Sofina Socit and Scheerders Van

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

The idea behind Sofina Socit Anonyme and Scheerders van Kerchoves 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 Sign In To Macroaxis module to sign in to explore Macroaxis' wealth optimization platform and fintech modules.