Correlation Between LAir Liquide and Infrastrutture Wireless

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

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

Diversification Opportunities for LAir Liquide and Infrastrutture Wireless

0.8

Correlation Coefficient

LAir Liquide  Infrastrutture Wireless

Very poor diversification

The 3 months correlation between LAir and Infrastrutture is 0.8. Overlapping area represents the amount of risk that can be diversified away by holding LAir Liquide SA and Infrastrutture Wireless Italia in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Infrastrutture Wireless and LAir Liquide 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 LAir Liquide SA are associated (or correlated) with Infrastrutture Wireless. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Infrastrutture Wireless has no effect on the direction of LAir Liquide i.e., LAir Liquide and Infrastrutture Wireless go up and down completely randomly.

Pair Corralation between LAir Liquide and Infrastrutture Wireless

Assuming the 90 days trading horizon LAir Liquide SA is expected to under-perform the Infrastrutture Wireless. But the stock apears to be less risky and, when comparing its historical volatility, LAir Liquide SA is 1.02 times less risky than Infrastrutture Wireless. The stock trades about -0.14 of its potential returns per unit of risk. The Infrastrutture Wireless Italiane is currently generating about 0.03 of returns per unit of risk over similar time horizon. If you would invest  1,024  in Infrastrutture Wireless Italiane on April 3, 2025 and sell it today you would earn a total of  6.00  from holding Infrastrutture Wireless Italiane or generate 0.59% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Together
Strength	Strong
Accuracy	95.65%
Values	Daily Returns

LAir Liquide SA  vs.  Infrastrutture Wireless Italia

LAir Liquide SA

Risk-Adjusted Performance

Insignificant

Compared to the overall equity markets, risk-adjusted returns on investments in LAir Liquide SA are ranked lower than 6 (%) of all global equities and portfolios over the last 90 days. In spite of comparatively stable basic indicators, LAir Liquide is not utilizing all of its potentials. The latest stock price uproar, may contribute to short-horizon losses for the private investors.

Infrastrutture Wireless

Risk-Adjusted Performance

Modest

Compared to the overall equity markets, risk-adjusted returns on investments in Infrastrutture Wireless Italiane are ranked lower than 6 (%) of all global equities and portfolios over the last 90 days. Despite nearly fragile basic indicators, Infrastrutture Wireless may actually be approaching a critical reversion point that can send shares even higher in August 2025.

Pair Trading with LAir Liquide and Infrastrutture Wireless

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

The idea behind LAir Liquide SA and Infrastrutture Wireless Italiane 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 Portfolio Dashboard module to portfolio dashboard that provides centralized access to all your investments.