Correlation Between Safran SA and Klepierre

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

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

Diversification Opportunities for Safran SA and Klepierre

0.72

Correlation Coefficient

Safran SA  Klepierre

Poor diversification

The 3 months correlation between Safran and Klepierre is 0.72. Overlapping area represents the amount of risk that can be diversified away by holding Safran SA and Klepierre SA in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Klepierre SA and Safran SA 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 Safran SA are associated (or correlated) with Klepierre. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Klepierre SA has no effect on the direction of Safran SA i.e., Safran SA and Klepierre go up and down completely randomly.

Pair Corralation between Safran SA and Klepierre

Assuming the 90 days trading horizon Safran SA is expected to generate 1.62 times more return on investment than Klepierre. However, Safran SA is 1.62 times more volatile than Klepierre SA. It trades about 0.25 of its potential returns per unit of risk. Klepierre SA is currently generating about 0.17 per unit of risk. If you would invest  22,753  in Safran SA on April 25, 2025 and sell it today you would earn a total of  5,107  from holding Safran SA or generate 22.45% return on investment over 90 days.

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

Safran SA  vs.  Klepierre SA

Safran SA

Risk-Adjusted Performance

Solid

Compared to the overall equity markets, risk-adjusted returns on investments in Safran SA are ranked lower than 19 (%) of all global equities and portfolios over the last 90 days. Despite somewhat weak technical and fundamental indicators, Safran SA sustained solid returns over the last few months and may actually be approaching a breakup point.

Klepierre SA

Risk-Adjusted Performance

Good

Compared to the overall equity markets, risk-adjusted returns on investments in Klepierre SA are ranked lower than 13 (%) of all global equities and portfolios over the last 90 days. Despite somewhat weak basic indicators, Klepierre may actually be approaching a critical reversion point that can send shares even higher in August 2025.

Pair Trading with Safran SA and Klepierre

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

The idea behind Safran SA and Klepierre 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 Portfolio Suggestion module to get suggestions outside of your existing asset allocation including your own model portfolios.