Correlation Between Teleperformance and Remy Cointreau

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

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

Diversification Opportunities for Teleperformance and Remy Cointreau

0.24

Correlation Coefficient

Teleperformance  Remy Cointreau

Modest diversification

The 3 months correlation between Teleperformance and Remy is 0.24. Overlapping area represents the amount of risk that can be diversified away by holding Teleperformance SE and Remy Cointreau SA in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Remy Cointreau SA and Teleperformance 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 Teleperformance SE are associated (or correlated) with Remy Cointreau. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Remy Cointreau SA has no effect on the direction of Teleperformance i.e., Teleperformance and Remy Cointreau go up and down completely randomly.

Pair Corralation between Teleperformance and Remy Cointreau

Assuming the 90 days horizon Teleperformance SE is expected to under-perform the Remy Cointreau. In addition to that, Teleperformance is 1.6 times more volatile than Remy Cointreau SA. It trades about -0.05 of its total potential returns per unit of risk. Remy Cointreau SA is currently generating about -0.08 per unit of volatility. If you would invest  1,782  in Remy Cointreau SA on October 11, 2024 and sell it today you would lose (1,188) from holding Remy Cointreau SA or give up 66.67% of portfolio value over 90 days.

Time Period	3 Months [change]
Direction	Moves Together
Strength	Very Weak
Accuracy	85.08%
Values	Daily Returns

Teleperformance SE  vs.  Remy Cointreau SA

Teleperformance SE

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Teleperformance SE has generated negative risk-adjusted returns adding no value to investors with long positions. Despite latest weak performance, the Stock's technical and fundamental indicators remain stable and the current disturbance on Wall Street may also be a sign of long-run gains for the company stockholders.

Remy Cointreau SA

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Remy Cointreau SA has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of latest unfluctuating 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.

Pair Trading with Teleperformance and Remy Cointreau

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

The idea behind Teleperformance SE and Remy Cointreau 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 Price Transformation module to use Price Transformation models to analyze the depth of different equity instruments across global markets.