Correlation Between Guerbet S and Assystem

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

By analyzing existing cross correlation between Guerbet S A and Assystem SA, you can compare the effects of market volatilities on Guerbet S and Assystem 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 Guerbet S with a short position of Assystem. Check out your portfolio center. Please also check ongoing floating volatility patterns of Guerbet S and Assystem.

Diversification Opportunities for Guerbet S and Assystem

0.76

Correlation Coefficient

Guerbet S  Assystem

Poor diversification

The 3 months correlation between Guerbet and Assystem is 0.76. Overlapping area represents the amount of risk that can be diversified away by holding Guerbet S A and Assystem SA in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Assystem SA and Guerbet S 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 Guerbet S A are associated (or correlated) with Assystem. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Assystem SA has no effect on the direction of Guerbet S i.e., Guerbet S and Assystem go up and down completely randomly.

Pair Corralation between Guerbet S and Assystem

Assuming the 90 days trading horizon Guerbet S is expected to generate 2.7 times less return on investment than Assystem. But when comparing it to its historical volatility, Guerbet S A is 2.19 times less risky than Assystem. It trades about 0.24 of its potential returns per unit of risk. Assystem SA is currently generating about 0.3 of returns per unit of risk over similar time horizon. If you would invest  3,710  in Assystem SA on October 7, 2024 and sell it today you would earn a total of  820.00  from holding Assystem SA or generate 22.1% return on investment over 90 days.

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

Guerbet S A  vs.  Assystem SA

Guerbet S A

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Guerbet S A has generated negative risk-adjusted returns adding no value to investors with long positions. Despite weak performance in the last few months, the Stock's basic indicators remain somewhat strong which may send shares a bit higher in February 2025. The current disturbance may also be a sign of long term up-swing for the company investors.

Assystem SA

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Assystem SA has generated negative risk-adjusted returns adding no value to investors with long positions. Despite somewhat strong basic indicators, Assystem is not utilizing all of its potentials. The current stock price disturbance, may contribute to short-term losses for the investors.

Pair Trading with Guerbet S and Assystem

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

The idea behind Guerbet S A and Assystem SA 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 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..