Correlation Between Aurea SA and Accor S

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

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

Diversification Opportunities for Aurea SA and Accor S

0.77

Correlation Coefficient

Aurea SA  Accor S

Poor diversification

The 3 months correlation between Aurea and Accor is 0.77. Overlapping area represents the amount of risk that can be diversified away by holding Aurea SA and Accor S A in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Accor S A and Aurea 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 Aurea SA are associated (or correlated) with Accor S. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Accor S A has no effect on the direction of Aurea SA i.e., Aurea SA and Accor S go up and down completely randomly.

Pair Corralation between Aurea SA and Accor S

Assuming the 90 days trading horizon Aurea SA is expected to generate 1.33 times less return on investment than Accor S. In addition to that, Aurea SA is 1.21 times more volatile than Accor S A. It trades about 0.11 of its total potential returns per unit of risk. Accor S A is currently generating about 0.17 per unit of volatility. If you would invest  4,206  in Accor S A on April 25, 2025 and sell it today you would earn a total of  724.00  from holding Accor S A or generate 17.21% return on investment over 90 days.

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

Aurea SA  vs.  Accor S A

Aurea SA

Risk-Adjusted Performance

OK

Compared to the overall equity markets, risk-adjusted returns on investments in Aurea SA are ranked lower than 8 (%) of all global equities and portfolios over the last 90 days. Despite somewhat weak basic indicators, Aurea SA may actually be approaching a critical reversion point that can send shares even higher in August 2025.

Accor S A

Risk-Adjusted Performance

Solid

Compared to the overall equity markets, risk-adjusted returns on investments in Accor S A are ranked lower than 13 (%) of all global equities and portfolios over the last 90 days. Despite somewhat weak basic indicators, Accor S sustained solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with Aurea SA and Accor S

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

The idea behind Aurea SA and Accor S A 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.

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 Portfolio Suggestion module to get suggestions outside of your existing asset allocation including your own model portfolios.