Correlation Between Claranova and Soitec SA
Can any of the company-specific risk be diversified away by investing in both Claranova and Soitec 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 Claranova and Soitec SA into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Claranova SE and Soitec SA, you can compare the effects of market volatilities on Claranova and Soitec 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 Claranova with a short position of Soitec SA. Check out your portfolio center. Please also check ongoing floating volatility patterns of Claranova and Soitec SA.
Diversification Opportunities for Claranova and Soitec SA
Very good diversification
The 3 months correlation between Claranova and Soitec is -0.47. Overlapping area represents the amount of risk that can be diversified away by holding Claranova SE and Soitec SA in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Soitec SA and Claranova 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 Claranova SE are associated (or correlated) with Soitec SA. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Soitec SA has no effect on the direction of Claranova i.e., Claranova and Soitec SA go up and down completely randomly.
Pair Corralation between Claranova and Soitec SA
Assuming the 90 days trading horizon Claranova SE is expected to generate 0.81 times more return on investment than Soitec SA. However, Claranova SE is 1.23 times less risky than Soitec SA. It trades about 0.16 of its potential returns per unit of risk. Soitec SA is currently generating about 0.02 per unit of risk. If you would invest 118.00 in Claranova SE on October 25, 2024 and sell it today you would earn a total of 8.00 from holding Claranova SE or generate 6.78% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Claranova SE vs. Soitec SA
Performance |
| Timeline |
| Claranova SE |
| Soitec SA |
Claranova and Soitec SA Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Claranova and Soitec SA
The main advantage of trading using opposite Claranova and Soitec SA positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Claranova position performs unexpectedly, Soitec 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 Soitec SA will offset losses from the drop in Soitec SA's long position.| Claranova vs. Solutions 30 SE | Claranova vs. BigBen Interactive | Claranova vs. SA Catana Group | Claranova vs. Solocal Group SA |
| Soitec SA vs. Vallourec | Soitec SA vs. Dassault Systemes SE | Soitec SA vs. Teleperformance SE | Soitec SA vs. Atos 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 Commodity Directory module to find actively traded commodities issued by global exchanges.
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