Correlation Between Ebro Foods and CIFI Holdings
Can any of the company-specific risk be diversified away by investing in both Ebro Foods and CIFI Holdings 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 Ebro Foods and CIFI Holdings into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Ebro Foods SA and CIFI Holdings Co, you can compare the effects of market volatilities on Ebro Foods and CIFI Holdings 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 Ebro Foods with a short position of CIFI Holdings. Check out your portfolio center. Please also check ongoing floating volatility patterns of Ebro Foods and CIFI Holdings.
Diversification Opportunities for Ebro Foods and CIFI Holdings
0.19 | Correlation Coefficient |
Average diversification
The 3 months correlation between Ebro and CIFI is 0.19. Overlapping area represents the amount of risk that can be diversified away by holding Ebro Foods SA and CIFI Holdings Co in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on CIFI Holdings and Ebro Foods 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 Ebro Foods SA are associated (or correlated) with CIFI Holdings. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of CIFI Holdings has no effect on the direction of Ebro Foods i.e., Ebro Foods and CIFI Holdings go up and down completely randomly.
Pair Corralation between Ebro Foods and CIFI Holdings
Assuming the 90 days horizon Ebro Foods SA is expected to generate 0.2 times more return on investment than CIFI Holdings. However, Ebro Foods SA is 4.92 times less risky than CIFI Holdings. It trades about -0.13 of its potential returns per unit of risk. CIFI Holdings Co is currently generating about -0.17 per unit of risk. If you would invest 1,624 in Ebro Foods SA on September 12, 2024 and sell it today you would lose (40.00) from holding Ebro Foods SA or give up 2.46% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Ebro Foods SA vs. CIFI Holdings Co
Performance |
| Timeline |
| Ebro Foods SA |
| CIFI Holdings |
Ebro Foods and CIFI Holdings Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Ebro Foods and CIFI Holdings
The main advantage of trading using opposite Ebro Foods and CIFI Holdings positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Ebro Foods position performs unexpectedly, CIFI Holdings 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 CIFI Holdings will offset losses from the drop in CIFI Holdings' long position.| Ebro Foods vs. Hormel Foods | Ebro Foods vs. Superior Plus Corp | Ebro Foods vs. SIVERS SEMICONDUCTORS AB | Ebro Foods vs. NorAm Drilling AS |
| CIFI Holdings vs. Canon Marketing Japan | CIFI Holdings vs. Fast Retailing Co | CIFI Holdings vs. Tradeweb Markets | CIFI Holdings vs. SIMS METAL MGT |
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 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.
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