Correlation Between EVS Broadcast and Alfa Financial
Can any of the company-specific risk be diversified away by investing in both EVS Broadcast and Alfa Financial 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 EVS Broadcast and Alfa Financial into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between EVS Broadcast Equipment and Alfa Financial Software, you can compare the effects of market volatilities on EVS Broadcast and Alfa Financial 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 EVS Broadcast with a short position of Alfa Financial. Check out your portfolio center. Please also check ongoing floating volatility patterns of EVS Broadcast and Alfa Financial.
Diversification Opportunities for EVS Broadcast and Alfa Financial
-0.07 | Correlation Coefficient |
Good diversification
The 3 months correlation between EVS and Alfa is -0.07. Overlapping area represents the amount of risk that can be diversified away by holding EVS Broadcast Equipment and Alfa Financial Software in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Alfa Financial Software and EVS Broadcast 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 EVS Broadcast Equipment are associated (or correlated) with Alfa Financial. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Alfa Financial Software has no effect on the direction of EVS Broadcast i.e., EVS Broadcast and Alfa Financial go up and down completely randomly.
Pair Corralation between EVS Broadcast and Alfa Financial
Assuming the 90 days trading horizon EVS Broadcast Equipment is expected to generate 0.72 times more return on investment than Alfa Financial. However, EVS Broadcast Equipment is 1.4 times less risky than Alfa Financial. It trades about -0.12 of its potential returns per unit of risk. Alfa Financial Software is currently generating about -0.26 per unit of risk. If you would invest 3,075 in EVS Broadcast Equipment on October 20, 2024 and sell it today you would lose (65.00) from holding EVS Broadcast Equipment or give up 2.11% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
EVS Broadcast Equipment vs. Alfa Financial Software
Performance |
| Timeline |
| EVS Broadcast Equipment |
| Alfa Financial Software |
EVS Broadcast and Alfa Financial Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with EVS Broadcast and Alfa Financial
The main advantage of trading using opposite EVS Broadcast and Alfa Financial positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if EVS Broadcast position performs unexpectedly, Alfa Financial 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 Alfa Financial will offset losses from the drop in Alfa Financial's long position.| EVS Broadcast vs. SIDETRADE EO 1 | EVS Broadcast vs. ETFS Coffee ETC | EVS Broadcast vs. INDOFOOD AGRI RES | EVS Broadcast vs. AUTO TRADER ADR |
| Alfa Financial vs. MOUNT GIBSON IRON | Alfa Financial vs. United Utilities Group | Alfa Financial vs. The Japan Steel | Alfa Financial vs. Xiwang Special Steel |
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 Analyzer module to analyze all characteristics, volatility and risk-adjusted return of Macroaxis ideas.
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