Correlation Between Shell PLC and Robeco Sust

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

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

Diversification Opportunities for Shell PLC and Robeco Sust

0.64

Correlation Coefficient

Shell PLC  Robeco Sust

Poor diversification

The 3 months correlation between Shell and Robeco is 0.64. Overlapping area represents the amount of risk that can be diversified away by holding Shell PLC and Robeco Sust Global in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Robeco Sust Global and Shell PLC 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 Shell PLC are associated (or correlated) with Robeco Sust. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Robeco Sust Global has no effect on the direction of Shell PLC i.e., Shell PLC and Robeco Sust go up and down completely randomly.

Pair Corralation between Shell PLC and Robeco Sust

Assuming the 90 days trading horizon Shell PLC is expected to generate 1.32 times less return on investment than Robeco Sust. In addition to that, Shell PLC is 1.47 times more volatile than Robeco Sust Global. It trades about 0.1 of its total potential returns per unit of risk. Robeco Sust Global is currently generating about 0.2 per unit of volatility. If you would invest  6,982  in Robeco Sust Global on April 23, 2025 and sell it today you would earn a total of  679.00  from holding Robeco Sust Global or generate 9.73% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Together
Strength	Significant
Accuracy	98.44%
Values	Daily Returns

Shell PLC  vs.  Robeco Sust Global

Shell PLC

Risk-Adjusted Performance

OK

Compared to the overall equity markets, risk-adjusted returns on investments in Shell PLC are ranked lower than 8 (%) of all global equities and portfolios over the last 90 days. Despite somewhat uncertain basic indicators, Shell PLC may actually be approaching a critical reversion point that can send shares even higher in August 2025.

Robeco Sust Global

Risk-Adjusted Performance

Good

Compared to the overall equity markets, risk-adjusted returns on investments in Robeco Sust Global are ranked lower than 15 (%) of all global equities and portfolios over the last 90 days. In spite of comparatively uncertain basic indicators, Robeco Sust may actually be approaching a critical reversion point that can send shares even higher in August 2025.

Pair Trading with Shell PLC and Robeco Sust

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

The idea behind Shell PLC and Robeco Sust Global 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 My Watchlist Analysis module to analyze my current watchlist and to refresh optimization strategy. Macroaxis watchlist is based on self-learning algorithm to remember stocks you like.