Correlation Between Dassault Systemes and SAP SE
Can any of the company-specific risk be diversified away by investing in both Dassault Systemes and SAP 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 Dassault Systemes and SAP SE into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Dassault Systemes SE and SAP SE, you can compare the effects of market volatilities on Dassault Systemes and SAP 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 Dassault Systemes with a short position of SAP SE. Check out your portfolio center. Please also check ongoing floating volatility patterns of Dassault Systemes and SAP SE.
Diversification Opportunities for Dassault Systemes and SAP SE
0.85 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between Dassault and SAP is 0.85. Overlapping area represents the amount of risk that can be diversified away by holding Dassault Systemes SE and SAP SE in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on SAP SE and Dassault Systemes 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 Dassault Systemes SE are associated (or correlated) with SAP SE. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of SAP SE has no effect on the direction of Dassault Systemes i.e., Dassault Systemes and SAP SE go up and down completely randomly.
Pair Corralation between Dassault Systemes and SAP SE
Assuming the 90 days horizon Dassault Systemes SE is expected to under-perform the SAP SE. In addition to that, Dassault Systemes is 1.67 times more volatile than SAP SE. It trades about -0.09 of its total potential returns per unit of risk. SAP SE is currently generating about -0.13 per unit of volatility. If you would invest 30,500 in SAP SE on June 9, 2025 and sell it today you would lose (3,600) from holding SAP SE or give up 11.8% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Dassault Systemes SE vs. SAP SE
Performance |
| Timeline |
| Dassault Systemes |
| SAP SE |
Dassault Systemes and SAP SE Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Dassault Systemes and SAP SE
The main advantage of trading using opposite Dassault Systemes and SAP SE positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Dassault Systemes position performs unexpectedly, SAP 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 SAP SE will offset losses from the drop in SAP SE's long position.| Dassault Systemes vs. Nextplat Corp | Dassault Systemes vs. Alarm Holdings | Dassault Systemes vs. Blackline | Dassault Systemes vs. Clear Secure |
| SAP SE vs. Dassault Systemes SE | SAP SE vs. The Sage Group | SAP SE vs. Xero Limited | SAP SE vs. RenoWorks Software |
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 Idea Breakdown module to analyze constituents of all Macroaxis ideas. Macroaxis investment ideas are predefined, sector-focused investing themes.
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