Correlation Between Lagardere SCA and Eutelsat Communications
Can any of the company-specific risk be diversified away by investing in both Lagardere SCA and Eutelsat Communications 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 Lagardere SCA and Eutelsat Communications into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Lagardere SCA and Eutelsat Communications SA, you can compare the effects of market volatilities on Lagardere SCA and Eutelsat Communications 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 Lagardere SCA with a short position of Eutelsat Communications. Check out your portfolio center. Please also check ongoing floating volatility patterns of Lagardere SCA and Eutelsat Communications.
Diversification Opportunities for Lagardere SCA and Eutelsat Communications
0.02 | Correlation Coefficient |
Significant diversification
The 3 months correlation between Lagardere and Eutelsat is 0.02. Overlapping area represents the amount of risk that can be diversified away by holding Lagardere SCA and Eutelsat Communications SA in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Eutelsat Communications and Lagardere SCA 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 Lagardere SCA are associated (or correlated) with Eutelsat Communications. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Eutelsat Communications has no effect on the direction of Lagardere SCA i.e., Lagardere SCA and Eutelsat Communications go up and down completely randomly.
Pair Corralation between Lagardere SCA and Eutelsat Communications
Assuming the 90 days trading horizon Lagardere SCA is expected to generate 0.47 times more return on investment than Eutelsat Communications. However, Lagardere SCA is 2.15 times less risky than Eutelsat Communications. It trades about 0.0 of its potential returns per unit of risk. Eutelsat Communications SA is currently generating about -0.2 per unit of risk. If you would invest 2,160 in Lagardere SCA on November 28, 2024 and sell it today you would lose (15.00) from holding Lagardere SCA or give up 0.69% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Lagardere SCA vs. Eutelsat Communications SA
Performance |
| Timeline |
| Lagardere SCA |
| Eutelsat Communications |
Lagardere SCA and Eutelsat Communications Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Lagardere SCA and Eutelsat Communications
The main advantage of trading using opposite Lagardere SCA and Eutelsat Communications positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Lagardere SCA position performs unexpectedly, Eutelsat Communications 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 Eutelsat Communications will offset losses from the drop in Eutelsat Communications' long position.| Lagardere SCA vs. Television Francaise 1 | Lagardere SCA vs. Publicis Groupe SA | Lagardere SCA vs. Bouygues SA | Lagardere SCA vs. Accor S A |
| Eutelsat Communications vs. SES S A | Eutelsat Communications vs. Rubis SCA | Eutelsat Communications vs. Coface SA | Eutelsat Communications vs. SCOR SE |
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 Stocks Directory module to find actively traded stocks across global markets.
Other Complementary Tools
| Transaction History View history of all your transactions and understand their impact on performance | |
| FinTech Suite Use AI to screen and filter profitable investment opportunities | |
| Stock Tickers Use high-impact, comprehensive, and customizable stock tickers that can be easily integrated to any websites | |
| 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 | |
| Funds Screener Find actively-traded funds from around the world traded on over 30 global exchanges |