Correlation Between TotalEnergies and EPC Groupe
Can any of the company-specific risk be diversified away by investing in both TotalEnergies and EPC Groupe 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 TotalEnergies and EPC Groupe into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between TotalEnergies EP Gabon and EPC Groupe, you can compare the effects of market volatilities on TotalEnergies and EPC Groupe 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 TotalEnergies with a short position of EPC Groupe. Check out your portfolio center. Please also check ongoing floating volatility patterns of TotalEnergies and EPC Groupe.
Diversification Opportunities for TotalEnergies and EPC Groupe
-0.25 | Correlation Coefficient |
Very good diversification
The 3 months correlation between TotalEnergies and EPC is -0.25. Overlapping area represents the amount of risk that can be diversified away by holding TotalEnergies EP Gabon and EPC Groupe in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on EPC Groupe and TotalEnergies 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 TotalEnergies EP Gabon are associated (or correlated) with EPC Groupe. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of EPC Groupe has no effect on the direction of TotalEnergies i.e., TotalEnergies and EPC Groupe go up and down completely randomly.
Pair Corralation between TotalEnergies and EPC Groupe
Assuming the 90 days horizon TotalEnergies is expected to generate 3.83 times less return on investment than EPC Groupe. But when comparing it to its historical volatility, TotalEnergies EP Gabon is 2.04 times less risky than EPC Groupe. It trades about 0.05 of its potential returns per unit of risk. EPC Groupe is currently generating about 0.09 of returns per unit of risk over similar time horizon. If you would invest 11,418 in EPC Groupe on August 24, 2024 and sell it today you would earn a total of 7,282 from holding EPC Groupe or generate 63.78% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
TotalEnergies EP Gabon vs. EPC Groupe
Performance |
| Timeline |
| TotalEnergies EP Gabon |
| EPC Groupe |
TotalEnergies and EPC Groupe Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with TotalEnergies and EPC Groupe
The main advantage of trading using opposite TotalEnergies and EPC Groupe positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if TotalEnergies position performs unexpectedly, EPC Groupe 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 EPC Groupe will offset losses from the drop in EPC Groupe's long position.| TotalEnergies vs. Etablissements Maurel et | TotalEnergies vs. Esso SAF | TotalEnergies vs. Mtropole Tlvision SA | TotalEnergies vs. Rubis SCA |
| EPC Groupe vs. Robertet SA | EPC Groupe vs. Grard Perrier Industrie | EPC Groupe vs. Samse SA | EPC Groupe vs. Manitou BF 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 Transaction History module to view history of all your transactions and understand their impact on performance.
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