Correlation Between Eurofins Scientific and Caisse Rgionale

Can any of the company-specific risk be diversified away by investing in both Eurofins Scientific and Caisse Rgionale 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 Eurofins Scientific and Caisse Rgionale into the same portfolio, which is an essential part of the fundamental portfolio management process.

By analyzing existing cross correlation between Eurofins Scientific SE and Caisse Rgionale du, you can compare the effects of market volatilities on Eurofins Scientific and Caisse Rgionale 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 Eurofins Scientific with a short position of Caisse Rgionale. Check out your portfolio center. Please also check ongoing floating volatility patterns of Eurofins Scientific and Caisse Rgionale.

Diversification Opportunities for Eurofins Scientific and Caisse Rgionale

0.24

Correlation Coefficient

Eurofins Scientific  Caisse Rgionale

Modest diversification

The 3 months correlation between Eurofins and Caisse is 0.24. Overlapping area represents the amount of risk that can be diversified away by holding Eurofins Scientific SE and Caisse Rgionale du in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Caisse Rgionale du and Eurofins Scientific 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 Eurofins Scientific SE are associated (or correlated) with Caisse Rgionale. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Caisse Rgionale du has no effect on the direction of Eurofins Scientific i.e., Eurofins Scientific and Caisse Rgionale go up and down completely randomly.

Pair Corralation between Eurofins Scientific and Caisse Rgionale

Assuming the 90 days trading horizon Eurofins Scientific is expected to generate 5.2 times less return on investment than Caisse Rgionale. In addition to that, Eurofins Scientific is 2.15 times more volatile than Caisse Rgionale du. It trades about 0.02 of its total potential returns per unit of risk. Caisse Rgionale du is currently generating about 0.22 per unit of volatility. If you would invest  8,400  in Caisse Rgionale du on December 31, 2024 and sell it today you would earn a total of  1,110  from holding Caisse Rgionale du or generate 13.21% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Together
Strength	Very Weak
Accuracy	100.0%
Values	Daily Returns

Eurofins Scientific SE  vs.  Caisse Rgionale du

Eurofins Scientific

Risk-Adjusted Performance

Weak

Compared to the overall equity markets, risk-adjusted returns on investments in Eurofins Scientific SE are ranked lower than 1 (%) of all global equities and portfolios over the last 90 days. Despite somewhat strong technical and fundamental indicators, Eurofins Scientific is not utilizing all of its potentials. The current stock price disturbance, may contribute to short-term losses for the investors.

Caisse Rgionale du

Risk-Adjusted Performance

Solid

Compared to the overall equity markets, risk-adjusted returns on investments in Caisse Rgionale du are ranked lower than 16 (%) of all global equities and portfolios over the last 90 days. Despite somewhat weak basic indicators, Caisse Rgionale may actually be approaching a critical reversion point that can send shares even higher in May 2025.

Pair Trading with Eurofins Scientific and Caisse Rgionale

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

The idea behind Eurofins Scientific SE and Caisse Rgionale du 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.

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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 Analyzer module to portfolio analysis module that provides access to portfolio diagnostics and optimization engine.