Correlation Between Entech SE and Lexibook Linguistic
Can any of the company-specific risk be diversified away by investing in both Entech SE and Lexibook Linguistic 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 Entech SE and Lexibook Linguistic into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Entech SE SAS and Lexibook Linguistic Electronic, you can compare the effects of market volatilities on Entech SE and Lexibook Linguistic 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 Entech SE with a short position of Lexibook Linguistic. Check out your portfolio center. Please also check ongoing floating volatility patterns of Entech SE and Lexibook Linguistic.
Diversification Opportunities for Entech SE and Lexibook Linguistic
0.53 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Entech and Lexibook is 0.53. Overlapping area represents the amount of risk that can be diversified away by holding Entech SE SAS and Lexibook Linguistic Electronic in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Lexibook Linguistic and Entech SE 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 Entech SE SAS are associated (or correlated) with Lexibook Linguistic. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Lexibook Linguistic has no effect on the direction of Entech SE i.e., Entech SE and Lexibook Linguistic go up and down completely randomly.
Pair Corralation between Entech SE and Lexibook Linguistic
Assuming the 90 days trading horizon Entech SE is expected to generate 5.5 times less return on investment than Lexibook Linguistic. In addition to that, Entech SE is 1.23 times more volatile than Lexibook Linguistic Electronic. It trades about 0.01 of its total potential returns per unit of risk. Lexibook Linguistic Electronic is currently generating about 0.08 per unit of volatility. If you would invest 219.00 in Lexibook Linguistic Electronic on December 7, 2024 and sell it today you would earn a total of 323.00 from holding Lexibook Linguistic Electronic or generate 147.49% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Entech SE SAS vs. Lexibook Linguistic Electronic
Performance |
| Timeline |
| Entech SE SAS |
| Lexibook Linguistic |
Entech SE and Lexibook Linguistic Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Entech SE and Lexibook Linguistic
The main advantage of trading using opposite Entech SE and Lexibook Linguistic positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Entech SE position performs unexpectedly, Lexibook Linguistic 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 Lexibook Linguistic will offset losses from the drop in Lexibook Linguistic's long position.| Entech SE vs. Afyren SAS | Entech SE vs. Voltalia SA | Entech SE vs. Waga Energy SA | Entech SE vs. Haffner Energy SA |
| Lexibook Linguistic vs. SA Catana Group | Lexibook Linguistic vs. Reworld Media | Lexibook Linguistic vs. Biosynex | Lexibook Linguistic vs. Moulinvest |
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 Options Analysis module to analyze and evaluate options and option chains as a potential hedge for your portfolios.
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