Correlation Between Echo Investment and Asseco Business
Can any of the company-specific risk be diversified away by investing in both Echo Investment and Asseco Business 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 Echo Investment and Asseco Business into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Echo Investment SA and Asseco Business Solutions, you can compare the effects of market volatilities on Echo Investment and Asseco Business 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 Echo Investment with a short position of Asseco Business. Check out your portfolio center. Please also check ongoing floating volatility patterns of Echo Investment and Asseco Business.
Diversification Opportunities for Echo Investment and Asseco Business
-0.54 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between Echo and Asseco is -0.54. Overlapping area represents the amount of risk that can be diversified away by holding Echo Investment SA and Asseco Business Solutions in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Asseco Business Solutions and Echo Investment 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 Echo Investment SA are associated (or correlated) with Asseco Business. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Asseco Business Solutions has no effect on the direction of Echo Investment i.e., Echo Investment and Asseco Business go up and down completely randomly.
Pair Corralation between Echo Investment and Asseco Business
Assuming the 90 days trading horizon Echo Investment SA is expected to generate 1.08 times more return on investment than Asseco Business. However, Echo Investment is 1.08 times more volatile than Asseco Business Solutions. It trades about 0.06 of its potential returns per unit of risk. Asseco Business Solutions is currently generating about -0.14 per unit of risk. If you would invest 410.00 in Echo Investment SA on September 2, 2024 and sell it today you would earn a total of 26.00 from holding Echo Investment SA or generate 6.34% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Echo Investment SA vs. Asseco Business Solutions
Performance |
| Timeline |
| Echo Investment SA |
| Asseco Business Solutions |
Echo Investment and Asseco Business Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Echo Investment and Asseco Business
The main advantage of trading using opposite Echo Investment and Asseco Business positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Echo Investment position performs unexpectedly, Asseco Business 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 Asseco Business will offset losses from the drop in Asseco Business' long position.| Echo Investment vs. Asseco Business Solutions | Echo Investment vs. Detalion Games SA | Echo Investment vs. Asseco South Eastern | Echo Investment vs. CFI Holding SA |
| Asseco Business vs. Marie Brizard Wine | Asseco Business vs. LSI Software SA | Asseco Business vs. PZ Cormay SA | Asseco Business vs. 3R Games SA |
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 Stocks Directory module to find actively traded stocks across global markets.
Other Complementary Tools
| Price Exposure Probability Analyze equity upside and downside potential for a given time horizon across multiple markets | |
| Portfolio Holdings Check your current holdings and cash postion to detemine if your portfolio needs rebalancing | |
| Insider Screener Find insiders across different sectors to evaluate their impact on performance | |
| Efficient Frontier Plot and analyze your portfolio and positions against risk-return landscape of the market. | |
| Cryptocurrency Center Build and monitor diversified portfolio of extremely risky digital assets and cryptocurrency |