Correlation Between Burelle SA and Eurazeo
Can any of the company-specific risk be diversified away by investing in both Burelle SA and Eurazeo 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 Burelle SA and Eurazeo into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Burelle SA and Eurazeo, you can compare the effects of market volatilities on Burelle SA and Eurazeo 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 Burelle SA with a short position of Eurazeo. Check out your portfolio center. Please also check ongoing floating volatility patterns of Burelle SA and Eurazeo.
Diversification Opportunities for Burelle SA and Eurazeo
-0.15 | Correlation Coefficient |
Good diversification
The 3 months correlation between Burelle and Eurazeo is -0.15. Overlapping area represents the amount of risk that can be diversified away by holding Burelle SA and Eurazeo in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Eurazeo and Burelle 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 Burelle SA are associated (or correlated) with Eurazeo. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Eurazeo has no effect on the direction of Burelle SA i.e., Burelle SA and Eurazeo go up and down completely randomly.
Pair Corralation between Burelle SA and Eurazeo
Assuming the 90 days trading horizon Burelle SA is expected to under-perform the Eurazeo. In addition to that, Burelle SA is 1.11 times more volatile than Eurazeo. It trades about -0.03 of its total potential returns per unit of risk. Eurazeo is currently generating about 0.19 per unit of volatility. If you would invest 7,085 in Eurazeo on October 26, 2024 and sell it today you would earn a total of 740.00 from holding Eurazeo or generate 10.44% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Burelle SA vs. Eurazeo
Performance |
| Timeline |
| Burelle SA |
| Eurazeo |
Burelle SA and Eurazeo Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Burelle SA and Eurazeo
The main advantage of trading using opposite Burelle SA and Eurazeo positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Burelle SA position performs unexpectedly, Eurazeo 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 Eurazeo will offset losses from the drop in Eurazeo's long position.| Burelle SA vs. Savencia SA | Burelle SA vs. Compagnie de lOdet | Burelle SA vs. Akwel SA | Burelle SA vs. Wendel |
| Eurazeo vs. Wendel | Eurazeo vs. Groep Brussel Lambert | Eurazeo vs. Ackermans Van Haaren | Eurazeo vs. SEB SA |
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 Global Markets Map module to get a quick overview of global market snapshot using zoomable world map. Drill down to check world indexes.
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