Correlation Between Sopra Steria and Manitou BF

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

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

Diversification Opportunities for Sopra Steria and Manitou BF

0.0

Correlation Coefficient

Sopra Steria  Manitou BF

Pay attention - limited upside

The 3 months correlation between Sopra and Manitou is 0.0. Overlapping area represents the amount of risk that can be diversified away by holding Sopra Steria Group and Manitou BF SA in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Manitou BF SA and Sopra Steria 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 Sopra Steria Group are associated (or correlated) with Manitou BF. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Manitou BF SA has no effect on the direction of Sopra Steria i.e., Sopra Steria and Manitou BF go up and down completely randomly.

Pair Corralation between Sopra Steria and Manitou BF

Assuming the 90 days trading horizon Sopra Steria Group is expected to under-perform the Manitou BF. But the stock apears to be less risky and, when comparing its historical volatility, Sopra Steria Group is 1.06 times less risky than Manitou BF. The stock trades about -0.1 of its potential returns per unit of risk. The Manitou BF SA is currently generating about 0.04 of returns per unit of risk over similar time horizon. If you would invest  1,694  in Manitou BF SA on October 15, 2024 and sell it today you would earn a total of  70.00  from holding Manitou BF SA or generate 4.13% return on investment over 90 days.

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

Sopra Steria Group  vs.  Manitou BF SA

Sopra Steria Group

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Sopra Steria Group has generated negative risk-adjusted returns adding no value to investors with long positions. Despite latest weak performance, the Stock's basic indicators remain strong and the current disturbance on Wall Street may also be a sign of long term gains for the company investors.

Manitou BF SA

Risk-Adjusted Performance

3 of 100

Weak

Compared to the overall equity markets, risk-adjusted returns on investments in Manitou BF SA are ranked lower than 3 (%) of all global equities and portfolios over the last 90 days. Despite somewhat strong basic indicators, Manitou BF is not utilizing all of its potentials. The current stock price disturbance, may contribute to short-term losses for the investors.

Pair Trading with Sopra Steria and Manitou BF

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

The idea behind Sopra Steria Group and Manitou BF 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 Equity Analysis module to research over 250,000 global equities including funds, stocks and ETFs to find investment opportunities.