Correlation Between Txcom SA and Acheter Louer

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

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

Diversification Opportunities for Txcom SA and Acheter Louer

0.41

Correlation Coefficient

Txcom SA  Acheter Louer

Very weak diversification

The 3 months correlation between Txcom and Acheter is 0.41. Overlapping area represents the amount of risk that can be diversified away by holding Txcom SA and Acheter Louer in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Acheter Louer and Txcom SA 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 Txcom SA are associated (or correlated) with Acheter Louer. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Acheter Louer has no effect on the direction of Txcom SA i.e., Txcom SA and Acheter Louer go up and down completely randomly.

Pair Corralation between Txcom SA and Acheter Louer

Assuming the 90 days trading horizon Txcom SA is expected to generate 22.34 times less return on investment than Acheter Louer. But when comparing it to its historical volatility, Txcom SA is 12.11 times less risky than Acheter Louer. It trades about 0.09 of its potential returns per unit of risk. Acheter Louer is currently generating about 0.16 of returns per unit of risk over similar time horizon. If you would invest  0.05  in Acheter Louer on April 22, 2025 and sell it today you would earn a total of  0.03  from holding Acheter Louer or generate 60.0% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Together
Strength	Weak
Accuracy	98.44%
Values	Daily Returns

Txcom SA  vs.  Acheter Louer

Txcom SA

Risk-Adjusted Performance

Modest

Over the last 90 days Txcom SA has generated negative risk-adjusted returns adding no value to investors with long positions. Even with relatively weak basic indicators, Txcom SA reported solid returns over the last few months and may actually be approaching a breakup point.

Acheter Louer

Risk-Adjusted Performance

Good

Compared to the overall equity markets, risk-adjusted returns on investments in Acheter Louer are ranked lower than 12 (%) of all global equities and portfolios over the last 90 days. Even with relatively weak basic indicators, Acheter Louer reported solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with Txcom SA and Acheter Louer

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

The idea behind Txcom SA and Acheter Louer 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 Piotroski F Score module to get Piotroski F Score based on the binary analysis strategy of nine different fundamentals.