Correlation Between Sartorius Stedim and Eurofins Scientific

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

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

Diversification Opportunities for Sartorius Stedim and Eurofins Scientific

-0.18

Correlation Coefficient

Sartorius Stedim  Eurofins Scientific

Good diversification

The 3 months correlation between Sartorius and Eurofins is -0.18. Overlapping area represents the amount of risk that can be diversified away by holding Sartorius Stedim Biotech and Eurofins Scientific SE in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Eurofins Scientific and Sartorius Stedim 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 Sartorius Stedim Biotech are associated (or correlated) with Eurofins Scientific. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Eurofins Scientific has no effect on the direction of Sartorius Stedim i.e., Sartorius Stedim and Eurofins Scientific go up and down completely randomly.

Pair Corralation between Sartorius Stedim and Eurofins Scientific

Assuming the 90 days trading horizon Sartorius Stedim Biotech is expected to under-perform the Eurofins Scientific. In addition to that, Sartorius Stedim is 1.52 times more volatile than Eurofins Scientific SE. It trades about -0.16 of its total potential returns per unit of risk. Eurofins Scientific SE is currently generating about 0.02 per unit of volatility. If you would invest  5,554  in Eurofins Scientific SE on March 1, 2024 and sell it today you would earn a total of  64.00  from holding Eurofins Scientific SE or generate 1.15% return on investment over 90 days.

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

Sartorius Stedim Biotech  vs.  Eurofins Scientific SE

Sartorius Stedim Biotech

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Sartorius Stedim Biotech 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 primary indicators remain somewhat strong which may send shares a bit higher in June 2024. The current disturbance may also be a sign of long term up-swing for the company investors.

Eurofins Scientific

Risk-Adjusted Performance

1 of 100

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.

Pair Trading with Sartorius Stedim and Eurofins Scientific

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

The idea behind Sartorius Stedim Biotech and Eurofins Scientific 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.

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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 Center module to all portfolio management and optimization tools to improve performance of your portfolios.