Correlation Between Neoen SA and Hopium SAS
Can any of the company-specific risk be diversified away by investing in both Neoen SA and Hopium SAS 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 Neoen SA and Hopium SAS into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Neoen SA and Hopium SAS, you can compare the effects of market volatilities on Neoen SA and Hopium SAS 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 Neoen SA with a short position of Hopium SAS. Check out your portfolio center. Please also check ongoing floating volatility patterns of Neoen SA and Hopium SAS.
Diversification Opportunities for Neoen SA and Hopium SAS
-0.91 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between Neoen and Hopium is -0.91. Overlapping area represents the amount of risk that can be diversified away by holding Neoen SA and Hopium SAS in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Hopium SAS and Neoen 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 Neoen SA are associated (or correlated) with Hopium SAS. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Hopium SAS has no effect on the direction of Neoen SA i.e., Neoen SA and Hopium SAS go up and down completely randomly.
Pair Corralation between Neoen SA and Hopium SAS
Assuming the 90 days trading horizon Neoen SA is expected to generate 0.05 times more return on investment than Hopium SAS. However, Neoen SA is 21.92 times less risky than Hopium SAS. It trades about 0.11 of its potential returns per unit of risk. Hopium SAS is currently generating about -0.31 per unit of risk. If you would invest 3,941 in Neoen SA on September 2, 2024 and sell it today you would earn a total of 13.00 from holding Neoen SA or generate 0.33% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Neoen SA vs. Hopium SAS
Performance |
| Timeline |
| Neoen SA |
| Hopium SAS |
Neoen SA and Hopium SAS Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Neoen SA and Hopium SAS
The main advantage of trading using opposite Neoen SA and Hopium SAS positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Neoen SA position performs unexpectedly, Hopium SAS 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 Hopium SAS will offset losses from the drop in Hopium SAS's long position.| Neoen SA vs. Voltalia SA | Neoen SA vs. Gaztransport Technigaz SAS | Neoen SA vs. Worldline SA | Neoen SA vs. Rubis SCA |
| Hopium SAS vs. Fill Up Media | Hopium SAS vs. Bilendi | Hopium SAS vs. Mauna Kea Technologies | Hopium SAS vs. ZCCM Investments Holdings |
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 Managers module to screen money managers from public funds and ETFs managed around the world.
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