Correlation Between Schneider Electric and Schneider Electric
Can any of the company-specific risk be diversified away by investing in both Schneider Electric and Schneider Electric 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 Schneider Electric and Schneider Electric into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Schneider Electric SA and Schneider Electric SE, you can compare the effects of market volatilities on Schneider Electric and Schneider Electric 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 Schneider Electric with a short position of Schneider Electric. Check out your portfolio center. Please also check ongoing floating volatility patterns of Schneider Electric and Schneider Electric.
Diversification Opportunities for Schneider Electric and Schneider Electric
0.76 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Schneider and Schneider is 0.76. Overlapping area represents the amount of risk that can be diversified away by holding Schneider Electric SA and Schneider Electric SE in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Schneider Electric and Schneider Electric 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 Schneider Electric SA are associated (or correlated) with Schneider Electric. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Schneider Electric has no effect on the direction of Schneider Electric i.e., Schneider Electric and Schneider Electric go up and down completely randomly.
Pair Corralation between Schneider Electric and Schneider Electric
Assuming the 90 days horizon Schneider Electric SA is expected to generate 0.68 times more return on investment than Schneider Electric. However, Schneider Electric SA is 1.47 times less risky than Schneider Electric. It trades about -0.16 of its potential returns per unit of risk. Schneider Electric SE is currently generating about -0.12 per unit of risk. If you would invest 5,312 in Schneider Electric SA on August 29, 2024 and sell it today you would lose (298.00) from holding Schneider Electric SA or give up 5.61% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 95.65% |
| Values | Daily Returns |
Schneider Electric SA vs. Schneider Electric SE
Performance |
| Timeline |
| Schneider Electric |
| Schneider Electric |
Schneider Electric and Schneider Electric Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Schneider Electric and Schneider Electric
The main advantage of trading using opposite Schneider Electric and Schneider Electric positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Schneider Electric position performs unexpectedly, Schneider Electric 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 Schneider Electric will offset losses from the drop in Schneider Electric's long position.| Schneider Electric vs. Sandvik AB ADR | Schneider Electric vs. Ingersoll Rand | Schneider Electric vs. Fanuc | Schneider Electric vs. Nordex SE |
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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 Competition Analyzer module to analyze and compare many basic indicators for a group of related or unrelated entities.
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