Correlation Between CFI Holding and Esotiq Henderson
Can any of the company-specific risk be diversified away by investing in both CFI Holding and Esotiq Henderson 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 CFI Holding and Esotiq Henderson into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between CFI Holding SA and Esotiq Henderson SA, you can compare the effects of market volatilities on CFI Holding and Esotiq Henderson 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 CFI Holding with a short position of Esotiq Henderson. Check out your portfolio center. Please also check ongoing floating volatility patterns of CFI Holding and Esotiq Henderson.
Diversification Opportunities for CFI Holding and Esotiq Henderson
-0.19 | Correlation Coefficient |
Good diversification
The 3 months correlation between CFI and Esotiq is -0.19. Overlapping area represents the amount of risk that can be diversified away by holding CFI Holding SA and Esotiq Henderson SA in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Esotiq Henderson and CFI Holding 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 CFI Holding SA are associated (or correlated) with Esotiq Henderson. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Esotiq Henderson has no effect on the direction of CFI Holding i.e., CFI Holding and Esotiq Henderson go up and down completely randomly.
Pair Corralation between CFI Holding and Esotiq Henderson
Assuming the 90 days trading horizon CFI Holding is expected to generate 14.91 times less return on investment than Esotiq Henderson. In addition to that, CFI Holding is 1.71 times more volatile than Esotiq Henderson SA. It trades about 0.0 of its total potential returns per unit of risk. Esotiq Henderson SA is currently generating about 0.09 per unit of volatility. If you would invest 2,040 in Esotiq Henderson SA on August 30, 2024 and sell it today you would earn a total of 2,810 from holding Esotiq Henderson SA or generate 137.75% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
CFI Holding SA vs. Esotiq Henderson SA
Performance |
| Timeline |
| CFI Holding SA |
| Esotiq Henderson |
CFI Holding and Esotiq Henderson Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with CFI Holding and Esotiq Henderson
The main advantage of trading using opposite CFI Holding and Esotiq Henderson positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if CFI Holding position performs unexpectedly, Esotiq Henderson 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 Esotiq Henderson will offset losses from the drop in Esotiq Henderson's long position.| CFI Holding vs. mBank SA | CFI Holding vs. Tower Investments SA | CFI Holding vs. MCI Management SA | CFI Holding vs. Echo Investment SA |
| Esotiq Henderson vs. Ultimate Games SA | Esotiq Henderson vs. BNP Paribas Bank | Esotiq Henderson vs. LSI Software SA | Esotiq Henderson vs. Alior Bank SA |
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 Pair Correlation module to compare performance and examine fundamental relationship between any two equity instruments.
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