Correlation Between Technip Energies and Broadpeak
Can any of the company-specific risk be diversified away by investing in both Technip Energies and Broadpeak 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 Technip Energies and Broadpeak into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Technip Energies BV and Broadpeak SA, you can compare the effects of market volatilities on Technip Energies and Broadpeak 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 Technip Energies with a short position of Broadpeak. Check out your portfolio center. Please also check ongoing floating volatility patterns of Technip Energies and Broadpeak.
Diversification Opportunities for Technip Energies and Broadpeak
-0.51 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between Technip and Broadpeak is -0.51. Overlapping area represents the amount of risk that can be diversified away by holding Technip Energies BV and Broadpeak SA in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Broadpeak SA and Technip Energies 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 Technip Energies BV are associated (or correlated) with Broadpeak. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Broadpeak SA has no effect on the direction of Technip Energies i.e., Technip Energies and Broadpeak go up and down completely randomly.
Pair Corralation between Technip Energies and Broadpeak
Assuming the 90 days horizon Technip Energies BV is expected to generate 0.8 times more return on investment than Broadpeak. However, Technip Energies BV is 1.25 times less risky than Broadpeak. It trades about 0.05 of its potential returns per unit of risk. Broadpeak SA is currently generating about -0.12 per unit of risk. 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 |
Technip Energies BV vs. Broadpeak SA
Performance |
| Timeline |
| Technip Energies |
| Broadpeak SA |
Technip Energies and Broadpeak Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Technip Energies and Broadpeak
The main advantage of trading using opposite Technip Energies and Broadpeak positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Technip Energies position performs unexpectedly, Broadpeak 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 Broadpeak will offset losses from the drop in Broadpeak's long position.| Technip Energies vs. Gaztransport Technigaz SAS | Technip Energies vs. TotalEnergies SE | Technip Energies vs. Neoen SA | Technip Energies vs. Rubis SCA |
| Broadpeak vs. ATEME SA | Broadpeak vs. Grolleau SAS | Broadpeak vs. Entech SE SAS | Broadpeak vs. Haffner Energy SA |
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 Sync Your Broker module to sync your existing holdings, watchlists, positions or portfolios from thousands of online brokerage services, banks, investment account aggregators and robo-advisors..
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