Correlation Between Delfingen and Chargeurs

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

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

Diversification Opportunities for Delfingen and Chargeurs

0.9

Correlation Coefficient

Delfingen  Chargeurs

Almost no diversification

The 3 months correlation between Delfingen and Chargeurs is 0.9. Overlapping area represents the amount of risk that can be diversified away by holding Delfingen and Chargeurs SA in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Chargeurs SA and Delfingen 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 Delfingen are associated (or correlated) with Chargeurs. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Chargeurs SA has no effect on the direction of Delfingen i.e., Delfingen and Chargeurs go up and down completely randomly.

Pair Corralation between Delfingen and Chargeurs

Assuming the 90 days trading horizon Delfingen is expected to under-perform the Chargeurs. But the stock apears to be less risky and, when comparing its historical volatility, Delfingen is 1.24 times less risky than Chargeurs. The stock trades about -0.12 of its potential returns per unit of risk. The Chargeurs SA is currently generating about -0.01 of returns per unit of risk over similar time horizon. If you would invest  1,253  in Chargeurs SA on September 3, 2024 and sell it today you would lose (273.00) from holding Chargeurs SA or give up 21.79% of portfolio value over 90 days.

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

Delfingen  vs.  Chargeurs SA

Delfingen

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Delfingen has generated negative risk-adjusted returns adding no value to investors with long positions. Even with weak performance in the last few months, the Stock's basic indicators remain relatively invariable which may send shares a bit higher in January 2025. The latest agitation may also be a sign of long-running up-swing for the enterprise retail investors.

Chargeurs SA

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Chargeurs SA has generated negative risk-adjusted returns adding no value to investors with long positions. Despite weak performance in the last few months, the Stock's forward indicators remain somewhat strong which may send shares a bit higher in January 2025. The current disturbance may also be a sign of long term up-swing for the company investors.

Pair Trading with Delfingen and Chargeurs

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

The idea behind Delfingen and Chargeurs 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 Competition Analyzer module to analyze and compare many basic indicators for a group of related or unrelated entities.