Correlation Between Robertet and Eurazeo

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

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

Diversification Opportunities for Robertet and Eurazeo

0.54

Correlation Coefficient

Robertet  Eurazeo

Very weak diversification

The 3 months correlation between Robertet and Eurazeo is 0.54. Overlapping area represents the amount of risk that can be diversified away by holding Robertet SA and Eurazeo in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Eurazeo and Robertet 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 Robertet SA are associated (or correlated) with Eurazeo. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Eurazeo has no effect on the direction of Robertet i.e., Robertet and Eurazeo go up and down completely randomly.

Pair Corralation between Robertet and Eurazeo

Assuming the 90 days trading horizon Robertet SA is expected to generate 0.93 times more return on investment than Eurazeo. However, Robertet SA is 1.07 times less risky than Eurazeo. It trades about 0.01 of its potential returns per unit of risk. Eurazeo is currently generating about 0.0 per unit of risk. If you would invest  87,600  in Robertet SA on August 31, 2024 and sell it today you would earn a total of  400.00  from holding Robertet SA or generate 0.46% return on investment over 90 days.

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

Robertet SA  vs.  Eurazeo

Robertet SA

Risk-Adjusted Performance

0 of 100

Very Weak

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

Eurazeo

Risk-Adjusted Performance

0 of 100

Very Weak

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

Pair Trading with Robertet and Eurazeo

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

The idea behind Robertet SA and Eurazeo 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 Earnings Calls module to check upcoming earnings announcements updated hourly across public exchanges.