Correlation Between Dassault Systemes and Eurofins Scientific
Can any of the company-specific risk be diversified away by investing in both Dassault Systemes 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 Dassault Systemes and Eurofins Scientific into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Dassault Systemes SE and Eurofins Scientific SE, you can compare the effects of market volatilities on Dassault Systemes 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 Dassault Systemes with a short position of Eurofins Scientific. Check out your portfolio center. Please also check ongoing floating volatility patterns of Dassault Systemes and Eurofins Scientific.
Diversification Opportunities for Dassault Systemes and Eurofins Scientific
0.76 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Dassault and Eurofins is 0.76. Overlapping area represents the amount of risk that can be diversified away by holding Dassault Systemes SE and Eurofins Scientific SE in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Eurofins Scientific and Dassault Systemes 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 Dassault Systemes SE 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 Dassault Systemes i.e., Dassault Systemes and Eurofins Scientific go up and down completely randomly.
Pair Corralation between Dassault Systemes and Eurofins Scientific
Assuming the 90 days trading horizon Dassault Systemes SE is expected to under-perform the Eurofins Scientific. But the stock apears to be less risky and, when comparing its historical volatility, Dassault Systemes SE is 1.61 times less risky than Eurofins Scientific. The stock trades about -0.09 of its potential returns per unit of risk. The Eurofins Scientific SE is currently generating about -0.05 of returns per unit of risk over similar time horizon. If you would invest 5,656 in Eurofins Scientific SE on August 25, 2024 and sell it today you would lose (960.00) from holding Eurofins Scientific SE or give up 16.97% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Dassault Systemes SE vs. Eurofins Scientific SE
Performance |
| Timeline |
| Dassault Systemes |
| Eurofins Scientific |
Dassault Systemes and Eurofins Scientific Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Dassault Systemes and Eurofins Scientific
The main advantage of trading using opposite Dassault Systemes and Eurofins Scientific positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Dassault Systemes 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.| Dassault Systemes vs. Thales SA | Dassault Systemes vs. Safran SA | Dassault Systemes vs. Air Liquide SA | Dassault Systemes vs. Capgemini SE |
| 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 Portfolio Center module to all portfolio management and optimization tools to improve performance of your portfolios.
Other Complementary Tools
| Portfolio Suggestion Get suggestions outside of your existing asset allocation including your own model portfolios | |
| Positions Ratings Determine portfolio positions ratings based on digital equity recommendations. Macroaxis instant position ratings are based on combination of fundamental analysis and risk-adjusted market performance | |
| Top Crypto Exchanges Search and analyze digital assets across top global cryptocurrency exchanges | |
| Share Portfolio Track or share privately all of your investments from the convenience of any device | |
| Portfolio Holdings Check your current holdings and cash postion to detemine if your portfolio needs rebalancing |