Correlation Between FactSet Research and Euronext

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

By analyzing existing cross correlation between FactSet Research Systems and Euronext NV, you can compare the effects of market volatilities on FactSet Research and Euronext 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 FactSet Research with a short position of Euronext. Check out your portfolio center. Please also check ongoing floating volatility patterns of FactSet Research and Euronext.

Diversification Opportunities for FactSet Research and Euronext

-0.75

Correlation Coefficient

FactSet Research  Euronext

Pay attention - limited upside

The 3 months correlation between FactSet and Euronext is -0.75. Overlapping area represents the amount of risk that can be diversified away by holding FactSet Research Systems and Euronext NV in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Euronext NV and FactSet Research 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 FactSet Research Systems are associated (or correlated) with Euronext. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Euronext NV has no effect on the direction of FactSet Research i.e., FactSet Research and Euronext go up and down completely randomly.

Pair Corralation between FactSet Research and Euronext

Considering the 90-day investment horizon FactSet Research Systems is expected to under-perform the Euronext. But the stock apears to be less risky and, when comparing its historical volatility, FactSet Research Systems is 1.41 times less risky than Euronext. The stock trades about -0.2 of its potential returns per unit of risk. The Euronext NV is currently generating about 0.21 of returns per unit of risk over similar time horizon. If you would invest  11,410  in Euronext NV on December 21, 2024 and sell it today you would earn a total of  2,221  from holding Euronext NV or generate 19.47% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Against
Strength	Weak
Accuracy	98.33%
Values	Daily Returns

FactSet Research Systems  vs.  Euronext NV

FactSet Research Systems

Risk-Adjusted Performance

Very Weak

Over the last 90 days FactSet Research Systems has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of weak performance in the last few months, the Stock's fundamental indicators remain comparatively stable which may send shares a bit higher in April 2025. The newest uproar may also be a sign of mid-term up-swing for the firm private investors.

Euronext NV

Risk-Adjusted Performance

Solid

Compared to the overall equity markets, risk-adjusted returns on investments in Euronext NV are ranked lower than 16 (%) of all global equities and portfolios over the last 90 days. Despite nearly fragile basic indicators, Euronext reported solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with FactSet Research and Euronext

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

The idea behind FactSet Research Systems and Euronext NV 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 Bonds Directory module to find actively traded corporate debentures issued by US companies.