Correlation Between Groupimo and Artea SA

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

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

Diversification Opportunities for Groupimo and Artea SA

0.7

Correlation Coefficient

Groupimo  Artea SA

Poor diversification

The 3 months correlation between Groupimo and Artea is 0.7. Overlapping area represents the amount of risk that can be diversified away by holding Groupimo SA and Artea SA in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Artea SA and Groupimo 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 Groupimo SA are associated (or correlated) with Artea SA. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Artea SA has no effect on the direction of Groupimo i.e., Groupimo and Artea SA go up and down completely randomly.

Pair Corralation between Groupimo and Artea SA

Assuming the 90 days trading horizon Groupimo SA is expected to generate 6.32 times more return on investment than Artea SA. However, Groupimo is 6.32 times more volatile than Artea SA. It trades about 0.07 of its potential returns per unit of risk. Artea SA is currently generating about 0.06 per unit of risk. If you would invest  20.00  in Groupimo SA on April 25, 2025 and sell it today you would earn a total of  1.00  from holding Groupimo SA or generate 5.0% return on investment over 90 days.

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

Groupimo SA  vs.  Artea SA

Groupimo SA

Risk-Adjusted Performance

Modest

Compared to the overall equity markets, risk-adjusted returns on investments in Groupimo SA are ranked lower than 5 (%) of all global equities and portfolios over the last 90 days. Even with relatively weak basic indicators, Groupimo reported solid returns over the last few months and may actually be approaching a breakup point.

Artea SA

Risk-Adjusted Performance

Insignificant

Compared to the overall equity markets, risk-adjusted returns on investments in Artea SA are ranked lower than 4 (%) of all global equities and portfolios over the last 90 days. Despite somewhat weak basic indicators, Artea SA may actually be approaching a critical reversion point that can send shares even higher in August 2025.

Pair Trading with Groupimo and Artea SA

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

The idea behind Groupimo SA and Artea 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 ETFs module to find actively traded Exchange Traded Funds (ETF) from around the world.