Correlation Between Euroapi SAS and TotalEnergies
Can any of the company-specific risk be diversified away by investing in both Euroapi SAS and TotalEnergies 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 Euroapi SAS and TotalEnergies into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Euroapi SAS and TotalEnergies SE, you can compare the effects of market volatilities on Euroapi SAS and TotalEnergies 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 Euroapi SAS with a short position of TotalEnergies. Check out your portfolio center. Please also check ongoing floating volatility patterns of Euroapi SAS and TotalEnergies.
Diversification Opportunities for Euroapi SAS and TotalEnergies
-0.21 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Euroapi and TotalEnergies is -0.21. Overlapping area represents the amount of risk that can be diversified away by holding Euroapi SAS and TotalEnergies SE in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on TotalEnergies SE and Euroapi SAS 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 Euroapi SAS are associated (or correlated) with TotalEnergies. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of TotalEnergies SE has no effect on the direction of Euroapi SAS i.e., Euroapi SAS and TotalEnergies go up and down completely randomly.
Pair Corralation between Euroapi SAS and TotalEnergies
Assuming the 90 days trading horizon Euroapi SAS is expected to under-perform the TotalEnergies. In addition to that, Euroapi SAS is 3.74 times more volatile than TotalEnergies SE. It trades about -0.02 of its total potential returns per unit of risk. TotalEnergies SE is currently generating about 0.0 per unit of volatility. If you would invest 5,878 in TotalEnergies SE on November 28, 2024 and sell it today you would lose (131.00) from holding TotalEnergies SE or give up 2.23% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 99.7% |
| Values | Daily Returns |
Euroapi SAS vs. TotalEnergies SE
Performance |
| Timeline |
| Euroapi SAS |
| TotalEnergies SE |
Euroapi SAS and TotalEnergies Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Euroapi SAS and TotalEnergies
The main advantage of trading using opposite Euroapi SAS and TotalEnergies positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Euroapi SAS position performs unexpectedly, TotalEnergies 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 TotalEnergies will offset losses from the drop in TotalEnergies' long position.| Euroapi SAS vs. Sanofi SA | Euroapi SAS vs. TotalEnergies SE | Euroapi SAS vs. Stellantis NV | Euroapi SAS vs. Gaztransport Technigaz SAS |
| TotalEnergies vs. Air Liquide SA | TotalEnergies vs. Engie SA | TotalEnergies vs. Sanofi SA | TotalEnergies vs. AXA 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 Portfolio Comparator module to compare the composition, asset allocations and performance of any two portfolios in your account.
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