Correlation Between Coda Octopus and Eve Holding
Can any of the company-specific risk be diversified away by investing in both Coda Octopus and Eve Holding 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 Coda Octopus and Eve Holding into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Coda Octopus Group and Eve Holding, you can compare the effects of market volatilities on Coda Octopus and Eve Holding 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 Coda Octopus with a short position of Eve Holding. Check out your portfolio center. Please also check ongoing floating volatility patterns of Coda Octopus and Eve Holding.
Diversification Opportunities for Coda Octopus and Eve Holding
-0.61 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between Coda and Eve is -0.61. Overlapping area represents the amount of risk that can be diversified away by holding Coda Octopus Group and Eve Holding in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Eve Holding and Coda Octopus 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 Coda Octopus Group are associated (or correlated) with Eve Holding. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Eve Holding has no effect on the direction of Coda Octopus i.e., Coda Octopus and Eve Holding go up and down completely randomly.
Pair Corralation between Coda Octopus and Eve Holding
Given the investment horizon of 90 days Coda Octopus Group is expected to under-perform the Eve Holding. But the stock apears to be less risky and, when comparing its historical volatility, Coda Octopus Group is 1.81 times less risky than Eve Holding. The stock trades about -0.1 of its potential returns per unit of risk. The Eve Holding is currently generating about 0.15 of returns per unit of risk over similar time horizon. If you would invest 402.00 in Eve Holding on November 3, 2024 and sell it today you would earn a total of 111.00 from holding Eve Holding or generate 27.61% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Coda Octopus Group vs. Eve Holding
Performance |
| Timeline |
| Coda Octopus Group |
| Eve Holding |
Coda Octopus and Eve Holding Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Coda Octopus and Eve Holding
The main advantage of trading using opposite Coda Octopus and Eve Holding positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Coda Octopus position performs unexpectedly, Eve Holding 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 Eve Holding will offset losses from the drop in Eve Holding's long position.| Coda Octopus vs. Ducommun Incorporated | Coda Octopus vs. Park Electrochemical | Coda Octopus vs. National Presto Industries | Coda Octopus vs. Astronics |
| Eve Holding vs. Heico | Eve Holding vs. Mercury Systems | Eve Holding vs. AeroVironment | Eve Holding vs. Howmet Aerospace |
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 Theme Ratings module to determine theme ratings based on digital equity recommendations. Macroaxis theme ratings are based on combination of fundamental analysis and risk-adjusted market performance.
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