Correlation Between Compagnie Plastic and Atos SE

Can any of the company-specific risk be diversified away by investing in both Compagnie Plastic and Atos SE 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 Compagnie Plastic and Atos SE into the same portfolio, which is an essential part of the fundamental portfolio management process.

By analyzing existing cross correlation between Compagnie Plastic Omnium and Atos SE, you can compare the effects of market volatilities on Compagnie Plastic and Atos SE 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 Compagnie Plastic with a short position of Atos SE. Check out your portfolio center. Please also check ongoing floating volatility patterns of Compagnie Plastic and Atos SE.

Diversification Opportunities for Compagnie Plastic and Atos SE

-0.33

Correlation Coefficient

Compagnie Plastic  Atos SE

Very good diversification

The 3 months correlation between Compagnie and Atos is -0.33. Overlapping area represents the amount of risk that can be diversified away by holding Compagnie Plastic Omnium and Atos SE in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Atos SE and Compagnie Plastic 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 Compagnie Plastic Omnium are associated (or correlated) with Atos SE. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Atos SE has no effect on the direction of Compagnie Plastic i.e., Compagnie Plastic and Atos SE go up and down completely randomly.

Pair Corralation between Compagnie Plastic and Atos SE

Assuming the 90 days trading horizon Compagnie Plastic Omnium is expected to generate 0.05 times more return on investment than Atos SE. However, Compagnie Plastic Omnium is 18.2 times less risky than Atos SE. It trades about 0.42 of its potential returns per unit of risk. Atos SE is currently generating about -0.15 per unit of risk. If you would invest  823.00  in Compagnie Plastic Omnium on September 27, 2024 and sell it today you would earn a total of  163.00  from holding Compagnie Plastic Omnium or generate 19.81% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Against
Strength	Insignificant
Accuracy	100.0%
Values	Daily Returns

Compagnie Plastic Omnium  vs.  Atos SE

Compagnie Plastic Omnium

Risk-Adjusted Performance

4 of 100

Insignificant

Compared to the overall equity markets, risk-adjusted returns on investments in Compagnie Plastic Omnium are ranked lower than 4 (%) of all global equities and portfolios over the last 90 days. In spite of comparatively uncertain basic indicators, Compagnie Plastic may actually be approaching a critical reversion point that can send shares even higher in January 2025.

Atos SE

Risk-Adjusted Performance

9 of 100

OK

Compared to the overall equity markets, risk-adjusted returns on investments in Atos SE are ranked lower than 9 (%) of all global equities and portfolios over the last 90 days. In spite of comparatively uncertain basic indicators, Atos SE unveiled solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with Compagnie Plastic and Atos SE

The main advantage of trading using opposite Compagnie Plastic and Atos SE positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Compagnie Plastic position performs unexpectedly, Atos SE 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 Atos SE will offset losses from the drop in Atos SE's long position.

The idea behind Compagnie Plastic Omnium and Atos SE pairs trading is to make the combined position market-neutral, meaning the overall market's direction will not affect its win or loss (or potential downside or upside). This can be achieved by designing a pairs trade with two highly correlated stocks or equities that operate in a similar space or sector, making it possible to obtain profits through simple and relatively low-risk investment.

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 Financial Widgets module to easily integrated Macroaxis content with over 30 different plug-and-play financial widgets.