Correlation Between Jacquet Metal and Vicat SA
Can any of the company-specific risk be diversified away by investing in both Jacquet Metal and Vicat SA 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 Jacquet Metal and Vicat SA into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Jacquet Metal Service and Vicat SA, you can compare the effects of market volatilities on Jacquet Metal and Vicat SA 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 Jacquet Metal with a short position of Vicat SA. Check out your portfolio center. Please also check ongoing floating volatility patterns of Jacquet Metal and Vicat SA.
Diversification Opportunities for Jacquet Metal and Vicat SA
0.26 | Correlation Coefficient |
Modest diversification
The 3 months correlation between Jacquet and Vicat is 0.26. Overlapping area represents the amount of risk that can be diversified away by holding Jacquet Metal Service and Vicat SA in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Vicat SA and Jacquet Metal 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 Jacquet Metal Service are associated (or correlated) with Vicat SA. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Vicat SA has no effect on the direction of Jacquet Metal i.e., Jacquet Metal and Vicat SA go up and down completely randomly.
Pair Corralation between Jacquet Metal and Vicat SA
Assuming the 90 days trading horizon Jacquet Metal is expected to generate 3.34 times less return on investment than Vicat SA. But when comparing it to its historical volatility, Jacquet Metal Service is 1.46 times less risky than Vicat SA. It trades about 0.09 of its potential returns per unit of risk. Vicat SA is currently generating about 0.22 of returns per unit of risk over similar time horizon. If you would invest 3,465 in Vicat SA on January 16, 2024 and sell it today you would earn a total of 175.00 from holding Vicat SA or generate 5.05% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Jacquet Metal Service vs. Vicat SA
Performance |
| Timeline |
| Jacquet Metal Service |
| Vicat SA |
Jacquet Metal and Vicat SA Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Jacquet Metal and Vicat SA
The main advantage of trading using opposite Jacquet Metal and Vicat SA positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Jacquet Metal position performs unexpectedly, Vicat SA 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 Vicat SA will offset losses from the drop in Vicat SA's long position.| Jacquet Metal vs. Mersen SA | Jacquet Metal vs. Trigano SA | Jacquet Metal vs. Chargeurs SA | Jacquet Metal vs. Eramet SA |
| Vicat SA vs. Rubis SCA | Vicat SA vs. Eramet SA | Vicat SA vs. Nexity | Vicat SA vs. Compagnie de Saint Gobain |
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 Performance Analysis module to check effects of mean-variance optimization against your current asset allocation.
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