Correlation Between Societe Generale and Eurofins Scientific
Can any of the company-specific risk be diversified away by investing in both Societe Generale and Eurofins Scientific 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 Societe Generale and Eurofins Scientific into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Societe Generale SA and Eurofins Scientific SE, you can compare the effects of market volatilities on Societe Generale and Eurofins Scientific 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 Societe Generale with a short position of Eurofins Scientific. Check out your portfolio center. Please also check ongoing floating volatility patterns of Societe Generale and Eurofins Scientific.
Diversification Opportunities for Societe Generale and Eurofins Scientific
-0.77 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between Societe and Eurofins is -0.77. Overlapping area represents the amount of risk that can be diversified away by holding Societe Generale SA and Eurofins Scientific SE in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Eurofins Scientific and Societe Generale 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 Societe Generale SA are associated (or correlated) with Eurofins Scientific. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Eurofins Scientific has no effect on the direction of Societe Generale i.e., Societe Generale and Eurofins Scientific go up and down completely randomly.
Pair Corralation between Societe Generale and Eurofins Scientific
Assuming the 90 days trading horizon Societe Generale SA is expected to generate 2.03 times more return on investment than Eurofins Scientific. However, Societe Generale is 2.03 times more volatile than Eurofins Scientific SE. It trades about 0.12 of its potential returns per unit of risk. Eurofins Scientific SE is currently generating about -0.04 per unit of risk. If you would invest 2,385 in Societe Generale SA on August 28, 2024 and sell it today you would earn a total of 159.00 from holding Societe Generale SA or generate 6.67% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Societe Generale SA vs. Eurofins Scientific SE
Performance |
| Timeline |
| Societe Generale |
| Eurofins Scientific |
Societe Generale and Eurofins Scientific Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Societe Generale and Eurofins Scientific
The main advantage of trading using opposite Societe Generale and Eurofins Scientific positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Societe Generale position performs unexpectedly, Eurofins Scientific 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 Eurofins Scientific will offset losses from the drop in Eurofins Scientific's long position.| Societe Generale vs. BNP Paribas SA | Societe Generale vs. Credit Agricole SA | Societe Generale vs. AXA SA | Societe Generale vs. Renault SA |
| Eurofins Scientific vs. Sartorius Stedim Biotech | Eurofins Scientific vs. Teleperformance SE | Eurofins Scientific vs. Dassault Systemes SE | Eurofins Scientific vs. Worldline 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 Fundamentals Comparison module to compare fundamentals across multiple equities to find investing opportunities.
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