Correlation Between Rubis SCA and Technip Energies
Can any of the company-specific risk be diversified away by investing in both Rubis SCA and Technip Energies 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 Rubis SCA and Technip Energies into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Rubis SCA and Technip Energies BV, you can compare the effects of market volatilities on Rubis SCA and Technip Energies 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 Rubis SCA with a short position of Technip Energies. Check out your portfolio center. Please also check ongoing floating volatility patterns of Rubis SCA and Technip Energies.
Diversification Opportunities for Rubis SCA and Technip Energies
-0.52 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between Rubis and Technip is -0.52. Overlapping area represents the amount of risk that can be diversified away by holding Rubis SCA and Technip Energies BV in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Technip Energies and Rubis 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 Rubis SCA are associated (or correlated) with Technip Energies. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Technip Energies has no effect on the direction of Rubis SCA i.e., Rubis SCA and Technip Energies go up and down completely randomly.
Pair Corralation between Rubis SCA and Technip Energies
Assuming the 90 days trading horizon Rubis SCA is expected to generate 2.99 times less return on investment than Technip Energies. But when comparing it to its historical volatility, Rubis SCA is 1.28 times less risky than Technip Energies. It trades about 0.02 of its potential returns per unit of risk. Technip Energies BV is currently generating about 0.05 of returns per unit of risk over similar time horizon. If you would invest 1,398 in Technip Energies BV on August 30, 2024 and sell it today you would earn a total of 856.00 from holding Technip Energies BV or generate 61.23% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Rubis SCA vs. Technip Energies BV
Performance |
| Timeline |
| Rubis SCA |
| Technip Energies |
Rubis SCA and Technip Energies Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Rubis SCA and Technip Energies
The main advantage of trading using opposite Rubis SCA and Technip Energies positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Rubis SCA position performs unexpectedly, Technip Energies 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 Technip Energies will offset losses from the drop in Technip Energies' long position.| Rubis SCA vs. Gaztransport Technigaz SAS | Rubis SCA vs. Nexity | Rubis SCA vs. SCOR SE | Rubis SCA vs. TotalEnergies SE |
| Technip Energies vs. Gaztransport Technigaz SAS | Technip Energies vs. TotalEnergies SE | Technip Energies vs. Neoen SA | Technip Energies vs. Rubis SCA |
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 Transaction History module to view history of all your transactions and understand their impact on performance.
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