Correlation Between Teleperformance and Atos SE

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

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

Diversification Opportunities for Teleperformance and Atos SE

-0.1

Correlation Coefficient

Teleperformance  Atos SE

Good diversification

The 3 months correlation between Teleperformance and Atos is -0.1. Overlapping area represents the amount of risk that can be diversified away by holding Teleperformance SE and Atos SE in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Atos SE and Teleperformance 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 Teleperformance SE 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 Teleperformance i.e., Teleperformance and Atos SE go up and down completely randomly.

Pair Corralation between Teleperformance and Atos SE

Assuming the 90 days trading horizon Teleperformance is expected to generate 44.01 times less return on investment than Atos SE. But when comparing it to its historical volatility, Teleperformance SE is 5.72 times less risky than Atos SE. It trades about 0.02 of its potential returns per unit of risk. Atos SE is currently generating about 0.15 of returns per unit of risk over similar time horizon. If you would invest  0.18  in Atos SE on October 16, 2024 and sell it today you would earn a total of  0.04  from holding Atos SE or generate 22.22% return on investment over 90 days.

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

Teleperformance SE  vs.  Atos SE

Teleperformance SE

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Teleperformance SE 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.

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. Despite somewhat weak basic indicators, Atos SE sustained solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with Teleperformance and Atos SE

The main advantage of trading using opposite Teleperformance and Atos SE positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Teleperformance 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 Teleperformance SE 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 Portfolio Suggestion module to get suggestions outside of your existing asset allocation including your own model portfolios.