Correlation Between Clean Harbors and EcoPlus
Can any of the company-specific risk be diversified away by investing in both Clean Harbors and EcoPlus 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 Clean Harbors and EcoPlus into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Clean Harbors and EcoPlus, you can compare the effects of market volatilities on Clean Harbors and EcoPlus 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 Clean Harbors with a short position of EcoPlus. Check out your portfolio center. Please also check ongoing floating volatility patterns of Clean Harbors and EcoPlus.
Diversification Opportunities for Clean Harbors and EcoPlus
0.13 | Correlation Coefficient |
Average diversification
The 3 months correlation between Clean and EcoPlus is 0.13. Overlapping area represents the amount of risk that can be diversified away by holding Clean Harbors and EcoPlus in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on EcoPlus and Clean Harbors 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 Clean Harbors are associated (or correlated) with EcoPlus. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of EcoPlus has no effect on the direction of Clean Harbors i.e., Clean Harbors and EcoPlus go up and down completely randomly.
Pair Corralation between Clean Harbors and EcoPlus
Considering the 90-day investment horizon Clean Harbors is expected to generate 0.32 times more return on investment than EcoPlus. However, Clean Harbors is 3.08 times less risky than EcoPlus. It trades about 0.0 of its potential returns per unit of risk. EcoPlus is currently generating about -0.26 per unit of risk. If you would invest 25,549 in Clean Harbors on August 25, 2024 and sell it today you would lose (299.00) from holding Clean Harbors or give up 1.17% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 95.65% |
| Values | Daily Returns |
Clean Harbors vs. EcoPlus
Performance |
| Timeline |
| Clean Harbors |
| EcoPlus |
Clean Harbors and EcoPlus Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Clean Harbors and EcoPlus
The main advantage of trading using opposite Clean Harbors and EcoPlus positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Clean Harbors position performs unexpectedly, EcoPlus 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 EcoPlus will offset losses from the drop in EcoPlus' long position.| Clean Harbors vs. Waste Connections | Clean Harbors vs. Casella Waste Systems | Clean Harbors vs. Waste Management | Clean Harbors vs. Gfl Environmental Holdings |
| EcoPlus vs. Republic Services | EcoPlus vs. Waste Connections | EcoPlus vs. Clean Harbors | EcoPlus vs. Gfl Environmental 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 Pattern Recognition module to use different Pattern Recognition models to time the market across multiple global exchanges.
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