Correlation Between Advantage Solutions and Eos Energy
Can any of the company-specific risk be diversified away by investing in both Advantage Solutions and Eos Energy 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 Advantage Solutions and Eos Energy into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Advantage Solutions and Eos Energy Enterprises, you can compare the effects of market volatilities on Advantage Solutions and Eos Energy 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 Advantage Solutions with a short position of Eos Energy. Check out your portfolio center. Please also check ongoing floating volatility patterns of Advantage Solutions and Eos Energy.
Diversification Opportunities for Advantage Solutions and Eos Energy
-0.02 | Correlation Coefficient |
Good diversification
The 3 months correlation between Advantage and Eos is -0.02. Overlapping area represents the amount of risk that can be diversified away by holding Advantage Solutions and Eos Energy Enterprises in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Eos Energy Enterprises and Advantage Solutions 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 Advantage Solutions are associated (or correlated) with Eos Energy. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Eos Energy Enterprises has no effect on the direction of Advantage Solutions i.e., Advantage Solutions and Eos Energy go up and down completely randomly.
Pair Corralation between Advantage Solutions and Eos Energy
Assuming the 90 days horizon Advantage Solutions is expected to generate 1.37 times more return on investment than Eos Energy. However, Advantage Solutions is 1.37 times more volatile than Eos Energy Enterprises. It trades about 0.05 of its potential returns per unit of risk. Eos Energy Enterprises is currently generating about 0.06 per unit of risk. If you would invest 20.00 in Advantage Solutions on August 24, 2024 and sell it today you would lose (17.30) from holding Advantage Solutions or give up 86.5% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 73.59% |
| Values | Daily Returns |
Advantage Solutions vs. Eos Energy Enterprises
Performance |
| Timeline |
| Advantage Solutions |
| Eos Energy Enterprises |
Advantage Solutions and Eos Energy Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Advantage Solutions and Eos Energy
The main advantage of trading using opposite Advantage Solutions and Eos Energy positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Advantage Solutions position performs unexpectedly, Eos Energy 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 Eos Energy will offset losses from the drop in Eos Energy's long position.| Advantage Solutions vs. CannBioRx Life Sciences | Advantage Solutions vs. GCM Grosvenor | Advantage Solutions vs. CuriosityStream |
| Eos Energy vs. Eos Energy Enterprises | Eos Energy vs. CuriosityStream | Eos Energy vs. GCM Grosvenor | Eos Energy vs. Canoo Holdings |
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 Top Crypto Exchanges module to search and analyze digital assets across top global cryptocurrency exchanges.
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