Correlation Between Vivendi SA and Groupe Tera
Can any of the company-specific risk be diversified away by investing in both Vivendi SA and Groupe Tera 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 Vivendi SA and Groupe Tera into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Vivendi SA and Groupe Tera SA, you can compare the effects of market volatilities on Vivendi SA and Groupe Tera 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 Vivendi SA with a short position of Groupe Tera. Check out your portfolio center. Please also check ongoing floating volatility patterns of Vivendi SA and Groupe Tera.
Diversification Opportunities for Vivendi SA and Groupe Tera
0.06 | Correlation Coefficient |
Significant diversification
The 3 months correlation between Vivendi and Groupe is 0.06. Overlapping area represents the amount of risk that can be diversified away by holding Vivendi SA and Groupe Tera SA in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Groupe Tera SA and Vivendi SA 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 Vivendi SA are associated (or correlated) with Groupe Tera. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Groupe Tera SA has no effect on the direction of Vivendi SA i.e., Vivendi SA and Groupe Tera go up and down completely randomly.
Pair Corralation between Vivendi SA and Groupe Tera
Assuming the 90 days trading horizon Vivendi SA is expected to generate 0.2 times more return on investment than Groupe Tera. However, Vivendi SA is 5.04 times less risky than Groupe Tera. It trades about 0.18 of its potential returns per unit of risk. Groupe Tera SA is currently generating about -0.12 per unit of risk. If you would invest 277.00 in Vivendi SA on December 4, 2024 and sell it today you would earn a total of 18.00 from holding Vivendi SA or generate 6.5% return on investment over 90 days.
Time Period | 3 Months [change] |
Direction | Moves Together |
Strength | Insignificant |
Accuracy | 100.0% |
Values | Daily Returns |
Vivendi SA vs. Groupe Tera SA
Performance |
Timeline |
Vivendi SA |
Groupe Tera SA |
Vivendi SA and Groupe Tera Volatility Contrast
Predicted Return Density |
Returns |
Pair Trading with Vivendi SA and Groupe Tera
The main advantage of trading using opposite Vivendi SA and Groupe Tera positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Vivendi SA position performs unexpectedly, Groupe Tera 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 Groupe Tera will offset losses from the drop in Groupe Tera's long position.Vivendi SA vs. Vinci SA | Vivendi SA vs. Compagnie de Saint Gobain | Vivendi SA vs. Bouygues SA | Vivendi SA vs. Carrefour SA |
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 Global Correlations module to find global opportunities by holding instruments from different markets.
Other Complementary Tools
Portfolio Optimization Compute new portfolio that will generate highest expected return given your specified tolerance for risk | |
FinTech Suite Use AI to screen and filter profitable investment opportunities | |
Price Exposure Probability Analyze equity upside and downside potential for a given time horizon across multiple markets | |
Share Portfolio Track or share privately all of your investments from the convenience of any device | |
Price Ceiling Movement Calculate and plot Price Ceiling Movement for different equity instruments |