Correlation Between Legrand SA and Experian Plc
Can any of the company-specific risk be diversified away by investing in both Legrand SA and Experian Plc 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 Legrand SA and Experian Plc into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Legrand SA and Experian plc PK, you can compare the effects of market volatilities on Legrand SA and Experian Plc 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 Legrand SA with a short position of Experian Plc. Check out your portfolio center. Please also check ongoing floating volatility patterns of Legrand SA and Experian Plc.
Diversification Opportunities for Legrand SA and Experian Plc
0.04 | Correlation Coefficient |
Significant diversification
The 3 months correlation between Legrand and Experian is 0.04. Overlapping area represents the amount of risk that can be diversified away by holding Legrand SA and Experian plc PK in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Experian plc PK and Legrand 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 Legrand SA are associated (or correlated) with Experian Plc. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Experian plc PK has no effect on the direction of Legrand SA i.e., Legrand SA and Experian Plc go up and down completely randomly.
Pair Corralation between Legrand SA and Experian Plc
Assuming the 90 days horizon Legrand SA is expected to generate 1.42 times more return on investment than Experian Plc. However, Legrand SA is 1.42 times more volatile than Experian plc PK. It trades about 0.01 of its potential returns per unit of risk. Experian plc PK is currently generating about -0.12 per unit of risk. If you would invest 15,100 in Legrand SA on September 2, 2025 and sell it today you would lose (119.00) from holding Legrand SA or give up 0.79% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 98.46% |
| Values | Daily Returns |
Legrand SA vs. Experian plc PK
Performance |
| Timeline |
| Legrand SA |
| Experian plc PK |
Legrand SA and Experian Plc Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Legrand SA and Experian Plc
The main advantage of trading using opposite Legrand SA and Experian Plc positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Legrand SA position performs unexpectedly, Experian Plc 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 Experian Plc will offset losses from the drop in Experian Plc's long position.| Legrand SA vs. Japan Airlines Ltd | Legrand SA vs. Tonopah Divide Mining | Legrand SA vs. Pembina Pipeline | Legrand SA vs. Integrated Drilling Equipment |
| Experian Plc vs. Cognyte Software | Experian Plc vs. Franklin Wireless Corp | Experian Plc vs. Piedmont Office Realty | Experian Plc vs. Progress Software |
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 Rebalancing module to analyze risk-adjusted returns against different time horizons to find asset-allocation targets.
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