Correlation Between Eurofins Scientific and DBV Technologies
Can any of the company-specific risk be diversified away by investing in both Eurofins Scientific and DBV Technologies 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 DBV Technologies 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 DBV Technologies SA, you can compare the effects of market volatilities on Eurofins Scientific and DBV Technologies 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 DBV Technologies. Check out your portfolio center. Please also check ongoing floating volatility patterns of Eurofins Scientific and DBV Technologies.
Diversification Opportunities for Eurofins Scientific and DBV Technologies
0.13 | Correlation Coefficient |
Average diversification
The 3 months correlation between Eurofins and DBV is 0.13. Overlapping area represents the amount of risk that can be diversified away by holding Eurofins Scientific SE and DBV Technologies SA in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on DBV Technologies 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 DBV Technologies. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of DBV Technologies has no effect on the direction of Eurofins Scientific i.e., Eurofins Scientific and DBV Technologies go up and down completely randomly.
Pair Corralation between Eurofins Scientific and DBV Technologies
Assuming the 90 days trading horizon Eurofins Scientific SE is expected to generate 0.32 times more return on investment than DBV Technologies. However, Eurofins Scientific SE is 3.1 times less risky than DBV Technologies. It trades about -0.04 of its potential returns per unit of risk. DBV Technologies SA is currently generating about -0.28 per unit of risk. If you would invest 4,700 in Eurofins Scientific SE on August 29, 2024 and sell it today you would lose (68.00) from holding Eurofins Scientific SE or give up 1.45% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Eurofins Scientific SE vs. DBV Technologies SA
Performance |
| Timeline |
| Eurofins Scientific |
| DBV Technologies |
Eurofins Scientific and DBV Technologies Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Eurofins Scientific and DBV Technologies
The main advantage of trading using opposite Eurofins Scientific and DBV Technologies positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Eurofins Scientific position performs unexpectedly, DBV Technologies 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 DBV Technologies will offset losses from the drop in DBV Technologies' long position.| Eurofins Scientific vs. Sartorius Stedim Biotech | Eurofins Scientific vs. Teleperformance SE | Eurofins Scientific vs. Dassault Systemes SE | Eurofins Scientific vs. Worldline SA |
| DBV Technologies vs. Biomerieux SA | DBV Technologies vs. Eurofins Scientific SE | DBV Technologies vs. Sartorius Stedim Biotech | DBV Technologies vs. SEB 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 Idea Analyzer module to analyze all characteristics, volatility and risk-adjusted return of Macroaxis ideas.
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