Correlation Between Publicis Groupe and Ideanomics
Can any of the company-specific risk be diversified away by investing in both Publicis Groupe and Ideanomics 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 Publicis Groupe and Ideanomics into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Publicis Groupe SA and Ideanomics, you can compare the effects of market volatilities on Publicis Groupe and Ideanomics 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 Publicis Groupe with a short position of Ideanomics. Check out your portfolio center. Please also check ongoing floating volatility patterns of Publicis Groupe and Ideanomics.
Diversification Opportunities for Publicis Groupe and Ideanomics
-0.32 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Publicis and Ideanomics is -0.32. Overlapping area represents the amount of risk that can be diversified away by holding Publicis Groupe SA and Ideanomics in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Ideanomics and Publicis Groupe 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 Publicis Groupe SA are associated (or correlated) with Ideanomics. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Ideanomics has no effect on the direction of Publicis Groupe i.e., Publicis Groupe and Ideanomics go up and down completely randomly.
Pair Corralation between Publicis Groupe and Ideanomics
Assuming the 90 days horizon Publicis Groupe SA is expected to generate 0.19 times more return on investment than Ideanomics. However, Publicis Groupe SA is 5.35 times less risky than Ideanomics. It trades about 0.06 of its potential returns per unit of risk. Ideanomics is currently generating about -0.12 per unit of risk. If you would invest 1,945 in Publicis Groupe SA on January 24, 2024 and sell it today you would earn a total of 178.00 from holding Publicis Groupe SA or generate 9.15% return on investment over 90 days.
Time Period | 3 Months [change] |
Direction | Moves Against |
Strength | Insignificant |
Accuracy | 52.91% |
Values | Daily Returns |
Publicis Groupe SA vs. Ideanomics
Performance |
Timeline |
Publicis Groupe SA |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Very Weak
Ideanomics |
Publicis Groupe and Ideanomics Volatility Contrast
Predicted Return Density |
Returns |
Pair Trading with Publicis Groupe and Ideanomics
The main advantage of trading using opposite Publicis Groupe and Ideanomics positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Publicis Groupe position performs unexpectedly, Ideanomics 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 Ideanomics will offset losses from the drop in Ideanomics' long position.Publicis Groupe vs. SwissCom AG | Publicis Groupe vs. Compagnie de Saint Gobain | Publicis Groupe vs. Vinci SA ADR | Publicis Groupe vs. Compagnie Generale des |
Ideanomics vs. Deere Company | Ideanomics vs. Caterpillar | Ideanomics vs. Lion Electric Corp | Ideanomics vs. Xos Inc |
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 Premium Stories module to follow Macroaxis premium stories from verified contributors across different equity types, categories and coverage scope.
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