Correlation Between CROWN and Genfit

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

By analyzing existing cross correlation between CROWN CASTLE INTERNATIONAL and Genfit, you can compare the effects of market volatilities on CROWN and Genfit 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 CROWN with a short position of Genfit. Check out your portfolio center. Please also check ongoing floating volatility patterns of CROWN and Genfit.

Diversification Opportunities for CROWN and Genfit

-0.13

Correlation Coefficient

CROWN  Genfit

Good diversification

The 3 months correlation between CROWN and Genfit is -0.13. Overlapping area represents the amount of risk that can be diversified away by holding CROWN CASTLE INTERNATIONAL and Genfit in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Genfit and CROWN 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 CROWN CASTLE INTERNATIONAL are associated (or correlated) with Genfit. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Genfit has no effect on the direction of CROWN i.e., CROWN and Genfit go up and down completely randomly.

Pair Corralation between CROWN and Genfit

Assuming the 90 days trading horizon CROWN CASTLE INTERNATIONAL is expected to under-perform the Genfit. But the bond apears to be less risky and, when comparing its historical volatility, CROWN CASTLE INTERNATIONAL is 6.21 times less risky than Genfit. The bond trades about -0.07 of its potential returns per unit of risk. The Genfit is currently generating about 0.01 of returns per unit of risk over similar time horizon. If you would invest  367.00  in Genfit on December 24, 2024 and sell it today you would lose (4.00) from holding Genfit or give up 1.09% of portfolio value over 90 days.

Time Period	3 Months [change]
Direction	Moves Against
Strength	Insignificant
Accuracy	98.36%
Values	Daily Returns

CROWN CASTLE INTERNATIONAL  vs.  Genfit

CROWN CASTLE INTERNA

Risk-Adjusted Performance

Very Weak

Over the last 90 days CROWN CASTLE INTERNATIONAL has generated negative risk-adjusted returns adding no value to investors with long positions. Despite somewhat strong basic indicators, CROWN is not utilizing all of its potentials. The current stock price disturbance, may contribute to short-term losses for the investors.

Genfit

Risk-Adjusted Performance

Very Weak

Over the last 90 days Genfit has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of comparatively stable technical and fundamental indicators, Genfit is not utilizing all of its potentials. The newest stock price uproar, may contribute to short-horizon losses for the private investors.

Pair Trading with CROWN and Genfit

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

The idea behind CROWN CASTLE INTERNATIONAL and Genfit 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.

Check out your portfolio center.

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 Efficient Frontier module to plot and analyze your portfolio and positions against risk-return landscape of the market..