Correlation Between Eutelsat Communications and ATEME SA
Can any of the company-specific risk be diversified away by investing in both Eutelsat Communications and ATEME 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 Eutelsat Communications and ATEME SA into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Eutelsat Communications SA and ATEME SA, you can compare the effects of market volatilities on Eutelsat Communications and ATEME 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 Eutelsat Communications with a short position of ATEME SA. Check out your portfolio center. Please also check ongoing floating volatility patterns of Eutelsat Communications and ATEME SA.
Diversification Opportunities for Eutelsat Communications and ATEME SA
-0.51 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between Eutelsat and ATEME is -0.51. Overlapping area represents the amount of risk that can be diversified away by holding Eutelsat Communications SA and ATEME SA in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on ATEME SA and Eutelsat Communications 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 Eutelsat Communications SA are associated (or correlated) with ATEME SA. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of ATEME SA has no effect on the direction of Eutelsat Communications i.e., Eutelsat Communications and ATEME SA go up and down completely randomly.
Pair Corralation between Eutelsat Communications and ATEME SA
Assuming the 90 days trading horizon Eutelsat Communications SA is expected to under-perform the ATEME SA. But the stock apears to be less risky and, when comparing its historical volatility, Eutelsat Communications SA is 1.26 times less risky than ATEME SA. The stock trades about -0.03 of its potential returns per unit of risk. The ATEME SA is currently generating about -0.02 of returns per unit of risk over similar time horizon. If you would invest 650.00 in ATEME SA on September 2, 2024 and sell it today you would lose (171.00) from holding ATEME SA or give up 26.31% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Eutelsat Communications SA vs. ATEME SA
Performance |
| Timeline |
| Eutelsat Communications |
| ATEME SA |
Eutelsat Communications and ATEME SA Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Eutelsat Communications and ATEME SA
The main advantage of trading using opposite Eutelsat Communications and ATEME SA positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Eutelsat Communications position performs unexpectedly, ATEME 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 ATEME SA will offset losses from the drop in ATEME SA's long position.| Eutelsat Communications vs. Rubis SCA | Eutelsat Communications vs. Coface SA | Eutelsat Communications vs. SCOR SE | Eutelsat Communications vs. Nexity |
| ATEME SA vs. Chargeurs SA | ATEME SA vs. Straumann Holding AG | ATEME SA vs. Manitou BF SA | ATEME SA vs. Amundi Index Solutions |
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 Money Flow Index module to determine momentum by analyzing Money Flow Index and other technical indicators.
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