Correlation Between Eurofins Scientific and Arkema SA
Can any of the company-specific risk be diversified away by investing in both Eurofins Scientific and Arkema 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 Eurofins Scientific and Arkema SA into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Eurofins Scientific SE and Arkema SA, you can compare the effects of market volatilities on Eurofins Scientific and Arkema 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 Eurofins Scientific with a short position of Arkema SA. Check out your portfolio center. Please also check ongoing floating volatility patterns of Eurofins Scientific and Arkema SA.
Diversification Opportunities for Eurofins Scientific and Arkema SA
0.37 | Correlation Coefficient |
Weak diversification
The 3 months correlation between Eurofins and Arkema is 0.37. Overlapping area represents the amount of risk that can be diversified away by holding Eurofins Scientific SE and Arkema SA in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Arkema SA and Eurofins Scientific 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 Eurofins Scientific SE are associated (or correlated) with Arkema SA. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Arkema SA has no effect on the direction of Eurofins Scientific i.e., Eurofins Scientific and Arkema SA go up and down completely randomly.
Pair Corralation between Eurofins Scientific and Arkema SA
Assuming the 90 days trading horizon Eurofins Scientific SE is expected to under-perform the Arkema SA. But the stock apears to be less risky and, when comparing its historical volatility, Eurofins Scientific SE is 1.19 times less risky than Arkema SA. The stock trades about -0.06 of its potential returns per unit of risk. The Arkema SA is currently generating about 0.17 of returns per unit of risk over similar time horizon. If you would invest 7,740 in Arkema SA on November 29, 2024 and sell it today you would earn a total of 605.00 from holding Arkema SA or generate 7.82% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Eurofins Scientific SE vs. Arkema SA
Performance |
| Timeline |
| Eurofins Scientific |
| Arkema SA |
Eurofins Scientific and Arkema SA Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Eurofins Scientific and Arkema SA
The main advantage of trading using opposite Eurofins Scientific and Arkema SA positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Eurofins Scientific position performs unexpectedly, Arkema 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 Arkema SA will offset losses from the drop in Arkema SA's long position.| Eurofins Scientific vs. Sartorius Stedim Biotech | Eurofins Scientific vs. Teleperformance SE | Eurofins Scientific vs. Biomerieux SA | Eurofins Scientific vs. Dassault Systemes SE |
| Arkema SA vs. Legrand SA | Arkema SA vs. Eiffage SA | Arkema SA vs. Imerys SA | Arkema SA vs. Bureau Veritas 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 AI Portfolio Architect module to use AI to generate optimal portfolios and find profitable investment opportunities.
Other Complementary Tools
| Bond Analysis Evaluate and analyze corporate bonds as a potential investment for your portfolios. | |
| Equity Forecasting Use basic forecasting models to generate price predictions and determine price momentum | |
| Crypto Correlations Use cryptocurrency correlation module to diversify your cryptocurrency portfolio across multiple coins | |
| My Watchlist Analysis Analyze my current watchlist and to refresh optimization strategy. Macroaxis watchlist is based on self-learning algorithm to remember stocks you like | |
| Money Managers Screen money managers from public funds and ETFs managed around the world |