Correlation Between Digital Realty and Eiffage SA
Can any of the company-specific risk be diversified away by investing in both Digital Realty and Eiffage 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 Digital Realty and Eiffage SA into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Digital Realty Trust and Eiffage SA, you can compare the effects of market volatilities on Digital Realty and Eiffage 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 Digital Realty with a short position of Eiffage SA. Check out your portfolio center. Please also check ongoing floating volatility patterns of Digital Realty and Eiffage SA.
Diversification Opportunities for Digital Realty and Eiffage SA
-0.81 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between Digital and Eiffage is -0.81. Overlapping area represents the amount of risk that can be diversified away by holding Digital Realty Trust and Eiffage SA in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Eiffage SA and Digital Realty 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 Digital Realty Trust are associated (or correlated) with Eiffage SA. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Eiffage SA has no effect on the direction of Digital Realty i.e., Digital Realty and Eiffage SA go up and down completely randomly.
Pair Corralation between Digital Realty and Eiffage SA
Assuming the 90 days trading horizon Digital Realty Trust is expected to generate 1.56 times more return on investment than Eiffage SA. However, Digital Realty is 1.56 times more volatile than Eiffage SA. It trades about 0.08 of its potential returns per unit of risk. Eiffage SA is currently generating about -0.01 per unit of risk. If you would invest 10,036 in Digital Realty Trust on August 30, 2024 and sell it today you would earn a total of 9,474 from holding Digital Realty Trust or generate 94.4% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Significant |
| Accuracy | 98.99% |
| Values | Daily Returns |
Digital Realty Trust vs. Eiffage SA
Performance |
| Timeline |
| Digital Realty Trust |
| Eiffage SA |
Digital Realty and Eiffage SA Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Digital Realty and Eiffage SA
The main advantage of trading using opposite Digital Realty and Eiffage SA positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Digital Realty position performs unexpectedly, Eiffage 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 Eiffage SA will offset losses from the drop in Eiffage SA's long position.| Digital Realty vs. Lendinvest PLC | Digital Realty vs. Neometals | Digital Realty vs. Albion Technology General | Digital Realty vs. Jupiter Fund Management |
| Eiffage SA vs. Indutrade AB | Eiffage SA vs. LPKF Laser Electronics | Eiffage SA vs. TechnipFMC PLC | Eiffage SA vs. Allianz Technology Trust |
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 Cryptocurrency Center module to build and monitor diversified portfolio of extremely risky digital assets and cryptocurrency.
Other Complementary Tools
| ETFs Find actively traded Exchange Traded Funds (ETF) from around the world | |
| Instant Ratings Determine any equity ratings based on digital recommendations. Macroaxis instant equity ratings are based on combination of fundamental analysis and risk-adjusted market performance | |
| Premium Stories Follow Macroaxis premium stories from verified contributors across different equity types, categories and coverage scope | |
| ETF Categories List of ETF categories grouped based on various criteria, such as the investment strategy or type of investments | |
| Sectors List of equity sectors categorizing publicly traded companies based on their primary business activities |