Correlation Between Echo Investment and Agora SA
Can any of the company-specific risk be diversified away by investing in both Echo Investment and Agora SA 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 Agora SA 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 Agora SA, you can compare the effects of market volatilities on Echo Investment and Agora SA 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 Agora SA. Check out your portfolio center. Please also check ongoing floating volatility patterns of Echo Investment and Agora SA.
Diversification Opportunities for Echo Investment and Agora SA
-0.44 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Echo and Agora is -0.44. Overlapping area represents the amount of risk that can be diversified away by holding Echo Investment SA and Agora SA in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Agora SA 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 Agora SA. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Agora SA has no effect on the direction of Echo Investment i.e., Echo Investment and Agora SA go up and down completely randomly.
Pair Corralation between Echo Investment and Agora SA
Assuming the 90 days trading horizon Echo Investment SA is expected to generate 0.84 times more return on investment than Agora SA. However, Echo Investment SA is 1.19 times less risky than Agora SA. It trades about 0.15 of its potential returns per unit of risk. Agora SA is currently generating about -0.11 per unit of risk. If you would invest 441.00 in Echo Investment SA on September 13, 2024 and sell it today you would earn a total of 44.00 from holding Echo Investment SA or generate 9.98% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 97.62% |
| Values | Daily Returns |
Echo Investment SA vs. Agora SA
Performance |
| Timeline |
| Echo Investment SA |
| Agora SA |
Echo Investment and Agora SA Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Echo Investment and Agora SA
The main advantage of trading using opposite Echo Investment and Agora SA positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Echo Investment position performs unexpectedly, Agora SA 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 Agora SA will offset losses from the drop in Agora SA's long position.| Echo Investment vs. GreenX Metals | Echo Investment vs. Saule Technologies SA | Echo Investment vs. PZ Cormay SA | Echo Investment vs. Medicalg |
| Agora SA vs. Echo Investment SA | Agora SA vs. CI Games SA | Agora SA vs. Gaming Factory SA | Agora SA vs. Skyline Investment 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 Analyst Advice module to analyst recommendations and target price estimates broken down by several categories.
Other Complementary Tools
| Fundamental Analysis View fundamental data based on most recent published financial statements | |
| Investing Opportunities Build portfolios using our predefined set of ideas and optimize them against your investing preferences | |
| Price Exposure Probability Analyze equity upside and downside potential for a given time horizon across multiple markets | |
| Competition Analyzer Analyze and compare many basic indicators for a group of related or unrelated entities | |
| Global Markets Map Get a quick overview of global market snapshot using zoomable world map. Drill down to check world indexes |