Correlation Between Hermes International and Hermes International
Can any of the company-specific risk be diversified away by investing in both Hermes International and Hermes International 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 Hermes International and Hermes International into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Hermes International SA and Hermes International SCA, you can compare the effects of market volatilities on Hermes International and Hermes International 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 Hermes International with a short position of Hermes International. Check out your portfolio center. Please also check ongoing floating volatility patterns of Hermes International and Hermes International.
Diversification Opportunities for Hermes International and Hermes International
0.99 | Correlation Coefficient |
No risk reduction
The 3 months correlation between Hermes and Hermes is 0.99. Overlapping area represents the amount of risk that can be diversified away by holding Hermes International SA and Hermes International SCA in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Hermes International SCA and Hermes International 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 Hermes International SA are associated (or correlated) with Hermes International. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Hermes International SCA has no effect on the direction of Hermes International i.e., Hermes International and Hermes International go up and down completely randomly.
Pair Corralation between Hermes International and Hermes International
Assuming the 90 days horizon Hermes International is expected to generate 1.16 times less return on investment than Hermes International. But when comparing it to its historical volatility, Hermes International SA is 1.44 times less risky than Hermes International. It trades about 0.08 of its potential returns per unit of risk. Hermes International SCA is currently generating about 0.07 of returns per unit of risk over similar time horizon. If you would invest 119,036 in Hermes International SCA on January 20, 2024 and sell it today you would earn a total of 131,844 from holding Hermes International SCA or generate 110.76% return on investment over 90 days.
Time Period | 3 Months [change] |
Direction | Moves Together |
Strength | Very Strong |
Accuracy | 99.8% |
Values | Daily Returns |
Hermes International SA vs. Hermes International SCA
Performance |
Timeline |
Hermes International |
Hermes International SCA |
Hermes International and Hermes International Volatility Contrast
Predicted Return Density |
Returns |
Pair Trading with Hermes International and Hermes International
The main advantage of trading using opposite Hermes International and Hermes International positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Hermes International position performs unexpectedly, Hermes International 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 Hermes International will offset losses from the drop in Hermes International's long position.Hermes International vs. LVMH Mot Hennessy | Hermes International vs. Kering SA | Hermes International vs. Capri Holdings | Hermes International vs. Tapestry |
Hermes International vs. Christian Dior SE | Hermes International vs. Burberry Group Plc | Hermes International vs. Compagnie Financiere Richemont | Hermes International vs. Hermes International 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 Fundamentals Comparison module to compare fundamentals across multiple equities to find investing opportunities.
Other Complementary Tools
Headlines Timeline Stay connected to all market stories and filter out noise. Drill down to analyze hype elasticity | |
Portfolio Anywhere Track or share privately all of your investments from the convenience of any device | |
ETFs Find actively traded Exchange Traded Funds (ETF) from around the world | |
Options Analysis Analyze and evaluate options and option chains as a potential hedge for your portfolios | |
Bond Analysis Evaluate and analyze corporate bonds as a potential investment for your portfolios. | |
Theme Ratings Determine theme ratings based on digital equity recommendations. Macroaxis theme ratings are based on combination of fundamental analysis and risk-adjusted market performance | |
Competition Analyzer Analyze and compare many basic indicators for a group of related or unrelated entities | |
Portfolio Manager State of the art Portfolio Manager to monitor and improve performance of your invested capital | |
Portfolio Optimization Compute new portfolio that will generate highest expected return given your specified tolerance for risk | |
Portfolio Backtesting Avoid under-diversification and over-optimization by backtesting your portfolios | |
Portfolio Suggestion Get suggestions outside of your existing asset allocation including your own model portfolios |