Correlation Between Euronext and Genfit SA

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

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

Diversification Opportunities for Euronext and Genfit SA

-0.1

Correlation Coefficient

Euronext  Genfit SA

Good diversification

The 3 months correlation between Euronext and Genfit is -0.1. Overlapping area represents the amount of risk that can be diversified away by holding Euronext NV and Genfit SA in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Genfit SA and Euronext 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 Euronext NV are associated (or correlated) with Genfit SA. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Genfit SA has no effect on the direction of Euronext i.e., Euronext and Genfit SA go up and down completely randomly.

Pair Corralation between Euronext and Genfit SA

Assuming the 90 days trading horizon Euronext is expected to generate 1.24 times less return on investment than Genfit SA. But when comparing it to its historical volatility, Euronext NV is 2.31 times less risky than Genfit SA. It trades about 0.09 of its potential returns per unit of risk. Genfit SA is currently generating about 0.05 of returns per unit of risk over similar time horizon. If you would invest  327.00  in Genfit SA on April 25, 2025 and sell it today you would earn a total of  20.00  from holding Genfit SA or generate 6.12% return on investment over 90 days.

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

Euronext NV  vs.  Genfit SA

Euronext NV

Risk-Adjusted Performance

OK

Compared to the overall equity markets, risk-adjusted returns on investments in Euronext NV are ranked lower than 7 (%) of all global equities and portfolios over the last 90 days. Despite somewhat weak basic indicators, Euronext may actually be approaching a critical reversion point that can send shares even higher in August 2025.

Genfit SA

Risk-Adjusted Performance

Insignificant

Compared to the overall equity markets, risk-adjusted returns on investments in Genfit SA are ranked lower than 3 (%) of all global equities and portfolios over the last 90 days. Despite somewhat weak basic indicators, Genfit SA may actually be approaching a critical reversion point that can send shares even higher in August 2025.

Pair Trading with Euronext and Genfit SA

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

The idea behind Euronext NV and Genfit 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 Stocks Directory module to find actively traded stocks across global markets.