Correlation Between Sensorion and Eurofins Scientific
Can any of the company-specific risk be diversified away by investing in both Sensorion and Eurofins Scientific 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 Sensorion and Eurofins Scientific into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Sensorion SA and Eurofins Scientific SE, you can compare the effects of market volatilities on Sensorion and Eurofins Scientific 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 Sensorion with a short position of Eurofins Scientific. Check out your portfolio center. Please also check ongoing floating volatility patterns of Sensorion and Eurofins Scientific.
Diversification Opportunities for Sensorion and Eurofins Scientific
0.46 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Sensorion and Eurofins is 0.46. Overlapping area represents the amount of risk that can be diversified away by holding Sensorion SA and Eurofins Scientific SE in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Eurofins Scientific and Sensorion 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 Sensorion SA are associated (or correlated) with Eurofins Scientific. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Eurofins Scientific has no effect on the direction of Sensorion i.e., Sensorion and Eurofins Scientific go up and down completely randomly.
Pair Corralation between Sensorion and Eurofins Scientific
Assuming the 90 days trading horizon Sensorion SA is expected to generate 1.8 times more return on investment than Eurofins Scientific. However, Sensorion is 1.8 times more volatile than Eurofins Scientific SE. It trades about 0.07 of its potential returns per unit of risk. Eurofins Scientific SE is currently generating about -0.02 per unit of risk. If you would invest 44.00 in Sensorion SA on September 3, 2024 and sell it today you would earn a total of 25.00 from holding Sensorion SA or generate 56.82% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Sensorion SA vs. Eurofins Scientific SE
Performance |
| Timeline |
| Sensorion SA |
| Eurofins Scientific |
Sensorion and Eurofins Scientific Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Sensorion and Eurofins Scientific
The main advantage of trading using opposite Sensorion and Eurofins Scientific positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Sensorion position performs unexpectedly, Eurofins Scientific 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 Eurofins Scientific will offset losses from the drop in Eurofins Scientific's long position.| Sensorion vs. Poxel SA | Sensorion vs. Quantum Genomics SA | Sensorion vs. Biophytis SA | Sensorion vs. Gensight Biologics SA |
| Eurofins Scientific vs. Sartorius Stedim Biotech | Eurofins Scientific vs. Teleperformance SE | Eurofins Scientific vs. Biomerieux SA | Eurofins Scientific vs. Dassault Systemes SE |
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.
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