Correlation Between 00108WAN0 and Inter Parfums

Can any of the company-specific risk be diversified away by investing in both 00108WAN0 and Inter Parfums 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 00108WAN0 and Inter Parfums into the same portfolio, which is an essential part of the fundamental portfolio management process.

By analyzing existing cross correlation between AEP 345 15 MAY 51 and Inter Parfums, you can compare the effects of market volatilities on 00108WAN0 and Inter Parfums 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 00108WAN0 with a short position of Inter Parfums. Check out your portfolio center. Please also check ongoing floating volatility patterns of 00108WAN0 and Inter Parfums.

Diversification Opportunities for 00108WAN0 and Inter Parfums

-0.62

Correlation Coefficient

00108WAN0  Inter Parfums

Excellent diversification

The 3 months correlation between 00108WAN0 and Inter is -0.62. Overlapping area represents the amount of risk that can be diversified away by holding AEP 345 15 MAY 51 and Inter Parfums in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Inter Parfums and 00108WAN0 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 AEP 345 15 MAY 51 are associated (or correlated) with Inter Parfums. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Inter Parfums has no effect on the direction of 00108WAN0 i.e., 00108WAN0 and Inter Parfums go up and down completely randomly.

Pair Corralation between 00108WAN0 and Inter Parfums

Assuming the 90 days trading horizon AEP 345 15 MAY 51 is expected to under-perform the Inter Parfums. In addition to that, 00108WAN0 is 1.14 times more volatile than Inter Parfums. It trades about -0.17 of its total potential returns per unit of risk. Inter Parfums is currently generating about -0.15 per unit of volatility. If you would invest  13,739  in Inter Parfums on October 12, 2024 and sell it today you would lose (572.00) from holding Inter Parfums or give up 4.16% of portfolio value over 90 days.

Time Period	3 Months [change]
Direction	Moves Against
Strength	Weak
Accuracy	85.0%
Values	Daily Returns

AEP 345 15 MAY 51  vs.  Inter Parfums

AEP 345 15

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days AEP 345 15 MAY 51 has generated negative risk-adjusted returns adding no value to investors with long positions. Despite latest weak performance, the Bond's basic indicators remain strong and the current disturbance on Wall Street may also be a sign of long term gains for AEP 345 15 MAY 51 investors.

Inter Parfums

Risk-Adjusted Performance

7 of 100

Modest

Compared to the overall equity markets, risk-adjusted returns on investments in Inter Parfums are ranked lower than 7 (%) of all global equities and portfolios over the last 90 days. Even with relatively fragile basic indicators, Inter Parfums may actually be approaching a critical reversion point that can send shares even higher in February 2025.

Pair Trading with 00108WAN0 and Inter Parfums

The main advantage of trading using opposite 00108WAN0 and Inter Parfums positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if 00108WAN0 position performs unexpectedly, Inter Parfums 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 Inter Parfums will offset losses from the drop in Inter Parfums' long position.

The idea behind AEP 345 15 MAY 51 and Inter Parfums 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.