Correlation Between Ebro Foods and Endurance Motive
Can any of the company-specific risk be diversified away by investing in both Ebro Foods and Endurance Motive 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 Ebro Foods and Endurance Motive into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Ebro Foods and Endurance Motive SA, you can compare the effects of market volatilities on Ebro Foods and Endurance Motive 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 Ebro Foods with a short position of Endurance Motive. Check out your portfolio center. Please also check ongoing floating volatility patterns of Ebro Foods and Endurance Motive.
Diversification Opportunities for Ebro Foods and Endurance Motive
-0.14 | Correlation Coefficient |
Good diversification
The 3 months correlation between Ebro and Endurance is -0.14. Overlapping area represents the amount of risk that can be diversified away by holding Ebro Foods and Endurance Motive SA in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Endurance Motive and Ebro Foods 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 Ebro Foods are associated (or correlated) with Endurance Motive. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Endurance Motive has no effect on the direction of Ebro Foods i.e., Ebro Foods and Endurance Motive go up and down completely randomly.
Pair Corralation between Ebro Foods and Endurance Motive
Assuming the 90 days trading horizon Ebro Foods is expected to generate 2.9 times less return on investment than Endurance Motive. But when comparing it to its historical volatility, Ebro Foods is 6.6 times less risky than Endurance Motive. It trades about 0.01 of its potential returns per unit of risk. Endurance Motive SA is currently generating about 0.0 of returns per unit of risk over similar time horizon. If you would invest 173.00 in Endurance Motive SA on September 12, 2024 and sell it today you would lose (51.00) from holding Endurance Motive SA or give up 29.48% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 99.72% |
| Values | Daily Returns |
Ebro Foods vs. Endurance Motive SA
Performance |
| Timeline |
| Ebro Foods |
| Endurance Motive |
Ebro Foods and Endurance Motive Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Ebro Foods and Endurance Motive
The main advantage of trading using opposite Ebro Foods and Endurance Motive positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Ebro Foods position performs unexpectedly, Endurance Motive 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 Endurance Motive will offset losses from the drop in Endurance Motive's long position.| Ebro Foods vs. Viscofan | Ebro Foods vs. Enags SA | Ebro Foods vs. Mapfre | Ebro Foods vs. Cia de Distribucion |
| Endurance Motive vs. Hispanotels Inversiones SOCIMI | Endurance Motive vs. Technomeca Aerospace SA | Endurance Motive vs. Ebro Foods | Endurance Motive vs. NH Hoteles |
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 ETFs module to find actively traded Exchange Traded Funds (ETF) from around the world.
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