Correlation Between E2E Networks and Selan Exploration
Can any of the company-specific risk be diversified away by investing in both E2E Networks and Selan Exploration 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 E2E Networks and Selan Exploration into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between E2E Networks Limited and Selan Exploration Technology, you can compare the effects of market volatilities on E2E Networks and Selan Exploration 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 E2E Networks with a short position of Selan Exploration. Check out your portfolio center. Please also check ongoing floating volatility patterns of E2E Networks and Selan Exploration.
Diversification Opportunities for E2E Networks and Selan Exploration
0.81 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between E2E and Selan is 0.81. Overlapping area represents the amount of risk that can be diversified away by holding E2E Networks Limited and Selan Exploration Technology in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Selan Exploration and E2E Networks 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 E2E Networks Limited are associated (or correlated) with Selan Exploration. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Selan Exploration has no effect on the direction of E2E Networks i.e., E2E Networks and Selan Exploration go up and down completely randomly.
Pair Corralation between E2E Networks and Selan Exploration
Assuming the 90 days trading horizon E2E Networks Limited is expected to generate 0.89 times more return on investment than Selan Exploration. However, E2E Networks Limited is 1.12 times less risky than Selan Exploration. It trades about -0.3 of its potential returns per unit of risk. Selan Exploration Technology is currently generating about -0.28 per unit of risk. If you would invest 443,790 in E2E Networks Limited on October 30, 2024 and sell it today you would lose (128,990) from holding E2E Networks Limited or give up 29.07% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Strong |
| Accuracy | 97.56% |
| Values | Daily Returns |
E2E Networks Limited vs. Selan Exploration Technology
Performance |
| Timeline |
| E2E Networks Limited |
| Selan Exploration |
E2E Networks and Selan Exploration Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with E2E Networks and Selan Exploration
The main advantage of trading using opposite E2E Networks and Selan Exploration positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if E2E Networks position performs unexpectedly, Selan Exploration 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 Selan Exploration will offset losses from the drop in Selan Exploration's long position.| E2E Networks vs. Baazar Style Retail | E2E Networks vs. Total Transport Systems | E2E Networks vs. Music Broadcast Limited | E2E Networks vs. Transport of |
| Selan Exploration vs. Tamilnad Mercantile Bank | Selan Exploration vs. Silver Touch Technologies | Selan Exploration vs. NRB Industrial Bearings | Selan Exploration vs. BF Utilities Limited |
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 Financial Widgets module to easily integrated Macroaxis content with over 30 different plug-and-play financial widgets.
Other Complementary Tools
| Portfolio Holdings Check your current holdings and cash postion to detemine if your portfolio needs rebalancing | |
| Fundamentals Comparison Compare fundamentals across multiple equities to find investing opportunities | |
| Volatility Analysis Get historical volatility and risk analysis based on latest market data | |
| Investing Opportunities Build portfolios using our predefined set of ideas and optimize them against your investing preferences | |
| Idea Breakdown Analyze constituents of all Macroaxis ideas. Macroaxis investment ideas are predefined, sector-focused investing themes |