Correlation Between Eni SPA and XXL Energy
Can any of the company-specific risk be diversified away by investing in both Eni SPA and XXL Energy 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 Eni SPA and XXL Energy into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Eni SpA ADR and XXL Energy Corp, you can compare the effects of market volatilities on Eni SPA and XXL Energy 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 Eni SPA with a short position of XXL Energy. Check out your portfolio center. Please also check ongoing floating volatility patterns of Eni SPA and XXL Energy.
Diversification Opportunities for Eni SPA and XXL Energy
0.35 | Correlation Coefficient |
Weak diversification
The 3 months correlation between Eni and XXL is 0.35. Overlapping area represents the amount of risk that can be diversified away by holding Eni SpA ADR and XXL Energy Corp in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on XXL Energy Corp and Eni SPA 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 Eni SpA ADR are associated (or correlated) with XXL Energy. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of XXL Energy Corp has no effect on the direction of Eni SPA i.e., Eni SPA and XXL Energy go up and down completely randomly.
Pair Corralation between Eni SPA and XXL Energy
Taking into account the 90-day investment horizon Eni SpA ADR is expected to generate 0.24 times more return on investment than XXL Energy. However, Eni SpA ADR is 4.25 times less risky than XXL Energy. It trades about 0.02 of its potential returns per unit of risk. XXL Energy Corp is currently generating about -0.03 per unit of risk. If you would invest 2,521 in Eni SpA ADR on September 2, 2024 and sell it today you would earn a total of 297.00 from holding Eni SpA ADR or generate 11.78% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 99.8% |
| Values | Daily Returns |
Eni SpA ADR vs. XXL Energy Corp
Performance |
| Timeline |
| Eni SpA ADR |
| XXL Energy Corp |
Eni SPA and XXL Energy Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Eni SPA and XXL Energy
The main advantage of trading using opposite Eni SPA and XXL Energy positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Eni SPA position performs unexpectedly, XXL Energy 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 XXL Energy will offset losses from the drop in XXL Energy's long position.| Eni SPA vs. TotalEnergies SE ADR | Eni SPA vs. Ecopetrol SA ADR | Eni SPA vs. Shell PLC ADR | Eni SPA vs. Petroleo Brasileiro Petrobras |
| XXL Energy vs. Petroleo Brasileiro Petrobras | XXL Energy vs. Equinor ASA ADR | XXL Energy vs. Eni SpA ADR | XXL Energy vs. YPF Sociedad Anonima |
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 Latest Portfolios module to quick portfolio dashboard that showcases your latest portfolios.
Other Complementary Tools
| Portfolio Analyzer Portfolio analysis module that provides access to portfolio diagnostics and optimization engine | |
| Watchlist Optimization Optimize watchlists to build efficient portfolios or rebalance existing positions based on the mean-variance optimization algorithm | |
| Sign In To Macroaxis Sign in to explore Macroaxis' wealth optimization platform and fintech modules | |
| ETFs Find actively traded Exchange Traded Funds (ETF) from around the world | |
| Risk-Return Analysis View associations between returns expected from investment and the risk you assume |