Correlation Between Daios Plastics and Cenergy Holdings
Can any of the company-specific risk be diversified away by investing in both Daios Plastics and Cenergy 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 Daios Plastics and Cenergy Holdings into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Daios Plastics SA and Cenergy Holdings SA, you can compare the effects of market volatilities on Daios Plastics and Cenergy 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 Daios Plastics with a short position of Cenergy Holdings. Check out your portfolio center. Please also check ongoing floating volatility patterns of Daios Plastics and Cenergy Holdings.
Diversification Opportunities for Daios Plastics and Cenergy Holdings
-0.87 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between Daios and Cenergy is -0.87. Overlapping area represents the amount of risk that can be diversified away by holding Daios Plastics SA and Cenergy Holdings SA in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Cenergy Holdings and Daios Plastics 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 Daios Plastics SA are associated (or correlated) with Cenergy Holdings. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Cenergy Holdings has no effect on the direction of Daios Plastics i.e., Daios Plastics and Cenergy Holdings go up and down completely randomly.
Pair Corralation between Daios Plastics and Cenergy Holdings
Assuming the 90 days trading horizon Daios Plastics is expected to generate 1.82 times less return on investment than Cenergy Holdings. In addition to that, Daios Plastics is 1.43 times more volatile than Cenergy Holdings SA. It trades about 0.02 of its total potential returns per unit of risk. Cenergy Holdings SA is currently generating about 0.06 per unit of volatility. If you would invest 587.00 in Cenergy Holdings SA on September 2, 2024 and sell it today you would earn a total of 283.00 from holding Cenergy Holdings SA or generate 48.21% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Daios Plastics SA vs. Cenergy Holdings SA
Performance |
| Timeline |
| Daios Plastics SA |
| Cenergy Holdings |
Daios Plastics and Cenergy Holdings Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Daios Plastics and Cenergy Holdings
The main advantage of trading using opposite Daios Plastics and Cenergy Holdings positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Daios Plastics position performs unexpectedly, Cenergy 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 Cenergy Holdings will offset losses from the drop in Cenergy Holdings' long position.| Daios Plastics vs. Ktima Kostas Lazaridis | Daios Plastics vs. Centric Holdings SA | Daios Plastics vs. Trastor Real Estate | Daios Plastics vs. As Commercial Industrial |
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 ETF Categories module to list of ETF categories grouped based on various criteria, such as the investment strategy or type of investments.
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