Correlation Between Eiffage SA and Bureau Veritas
Can any of the company-specific risk be diversified away by investing in both Eiffage SA and Bureau Veritas 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 Eiffage SA and Bureau Veritas into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Eiffage SA and Bureau Veritas SA, you can compare the effects of market volatilities on Eiffage SA and Bureau Veritas 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 Eiffage SA with a short position of Bureau Veritas. Check out your portfolio center. Please also check ongoing floating volatility patterns of Eiffage SA and Bureau Veritas.
Diversification Opportunities for Eiffage SA and Bureau Veritas
0.55 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Eiffage and Bureau is 0.55. Overlapping area represents the amount of risk that can be diversified away by holding Eiffage SA and Bureau Veritas SA in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Bureau Veritas SA and Eiffage SA 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 Eiffage SA are associated (or correlated) with Bureau Veritas. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Bureau Veritas SA has no effect on the direction of Eiffage SA i.e., Eiffage SA and Bureau Veritas go up and down completely randomly.
Pair Corralation between Eiffage SA and Bureau Veritas
Assuming the 90 days trading horizon Eiffage SA is expected to under-perform the Bureau Veritas. But the stock apears to be less risky and, when comparing its historical volatility, Eiffage SA is 1.14 times less risky than Bureau Veritas. The stock trades about -0.14 of its potential returns per unit of risk. The Bureau Veritas SA is currently generating about -0.1 of returns per unit of risk over similar time horizon. If you would invest 2,956 in Bureau Veritas SA on August 28, 2024 and sell it today you would lose (78.00) from holding Bureau Veritas SA or give up 2.64% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Eiffage SA vs. Bureau Veritas SA
Performance |
| Timeline |
| Eiffage SA |
| Bureau Veritas SA |
Eiffage SA and Bureau Veritas Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Eiffage SA and Bureau Veritas
The main advantage of trading using opposite Eiffage SA and Bureau Veritas positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Eiffage SA position performs unexpectedly, Bureau Veritas 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 Bureau Veritas will offset losses from the drop in Bureau Veritas' long position.| Eiffage SA vs. SQLI SA | Eiffage SA vs. Foncire Volta | Eiffage SA vs. Moulinvest | Eiffage SA vs. Manitou BF SA |
| Bureau Veritas vs. Prodways Group SA | Bureau Veritas vs. Claranova SE | Bureau Veritas vs. DBV Technologies SA | Bureau Veritas 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 Commodity Directory module to find actively traded commodities issued by global exchanges.
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