Correlation Between Séché Environnement and United States
Can any of the company-specific risk be diversified away by investing in both Séché Environnement and United States 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 Séché Environnement and United States into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Sch Environnement SA and United States Steel, you can compare the effects of market volatilities on Séché Environnement and United States 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 Séché Environnement with a short position of United States. Check out your portfolio center. Please also check ongoing floating volatility patterns of Séché Environnement and United States.
Diversification Opportunities for Séché Environnement and United States
0.47 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Séché and United is 0.47. Overlapping area represents the amount of risk that can be diversified away by holding Sch Environnement SA and United States Steel in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on United States Steel and Séché Environnement 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 Sch Environnement SA are associated (or correlated) with United States. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of United States Steel has no effect on the direction of Séché Environnement i.e., Séché Environnement and United States go up and down completely randomly.
Pair Corralation between Séché Environnement and United States
Assuming the 90 days horizon Sch Environnement SA is expected to under-perform the United States. But the stock apears to be less risky and, when comparing its historical volatility, Sch Environnement SA is 1.56 times less risky than United States. The stock trades about -0.02 of its potential returns per unit of risk. The United States Steel is currently generating about 0.03 of returns per unit of risk over similar time horizon. If you would invest 2,534 in United States Steel on October 14, 2024 and sell it today you would earn a total of 641.00 from holding United States Steel or generate 25.3% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Sch Environnement SA vs. United States Steel
Performance |
| Timeline |
| Séché Environnement |
| United States Steel |
Séché Environnement and United States Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Séché Environnement and United States
The main advantage of trading using opposite Séché Environnement and United States positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Séché Environnement position performs unexpectedly, United States 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 United States will offset losses from the drop in United States' long position.| Séché Environnement vs. EAGLE MATERIALS | Séché Environnement vs. Applied Materials | Séché Environnement vs. VULCAN MATERIALS | Séché Environnement vs. SILVER BULLET DATA |
| United States vs. VITEC SOFTWARE GROUP | United States vs. Check Point Software | United States vs. EIDESVIK OFFSHORE NK | United States vs. Guidewire Software |
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 Portfolio Center module to all portfolio management and optimization tools to improve performance of your portfolios.
Other Complementary Tools
| Options Analysis Analyze and evaluate options and option chains as a potential hedge for your portfolios | |
| Investing Opportunities Build portfolios using our predefined set of ideas and optimize them against your investing preferences | |
| Earnings Calls Check upcoming earnings announcements updated hourly across public exchanges | |
| Funds Screener Find actively-traded funds from around the world traded on over 30 global exchanges | |
| Competition Analyzer Analyze and compare many basic indicators for a group of related or unrelated entities |