Correlation Between Sword Group and Piscines Desjoyaux

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

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

Diversification Opportunities for Sword Group and Piscines Desjoyaux

-0.56

Correlation Coefficient

Sword Group  Piscines Desjoyaux

Excellent diversification

The 3 months correlation between Sword and Piscines is -0.56. Overlapping area represents the amount of risk that can be diversified away by holding Sword Group SE and Piscines Desjoyaux SA in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Piscines Desjoyaux and Sword Group 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 Sword Group SE are associated (or correlated) with Piscines Desjoyaux. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Piscines Desjoyaux has no effect on the direction of Sword Group i.e., Sword Group and Piscines Desjoyaux go up and down completely randomly.

Pair Corralation between Sword Group and Piscines Desjoyaux

Assuming the 90 days trading horizon Sword Group SE is expected to under-perform the Piscines Desjoyaux. But the stock apears to be less risky and, when comparing its historical volatility, Sword Group SE is 1.31 times less risky than Piscines Desjoyaux. The stock trades about -0.14 of its potential returns per unit of risk. The Piscines Desjoyaux SA is currently generating about 0.11 of returns per unit of risk over similar time horizon. If you would invest  1,230  in Piscines Desjoyaux SA on December 28, 2024 and sell it today you would earn a total of  150.00  from holding Piscines Desjoyaux SA or generate 12.2% return on investment over 90 days.

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

Sword Group SE  vs.  Piscines Desjoyaux SA

Sword Group SE

Risk-Adjusted Performance

Very Weak

Over the last 90 days Sword Group SE 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.

Piscines Desjoyaux

Risk-Adjusted Performance

OK

Compared to the overall equity markets, risk-adjusted returns on investments in Piscines Desjoyaux SA are ranked lower than 8 (%) of all global equities and portfolios over the last 90 days. Even with relatively weak basic indicators, Piscines Desjoyaux may actually be approaching a critical reversion point that can send shares even higher in April 2025.

Pair Trading with Sword Group and Piscines Desjoyaux

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

The idea behind Sword Group SE and Piscines Desjoyaux 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.