Correlation Between Ecolab and Amyris
Can any of the company-specific risk be diversified away by investing in both Ecolab and Amyris 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 Ecolab and Amyris into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Ecolab Inc and Amyris Inc, you can compare the effects of market volatilities on Ecolab and Amyris 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 Ecolab with a short position of Amyris. Check out your portfolio center. Please also check ongoing floating volatility patterns of Ecolab and Amyris.
Diversification Opportunities for Ecolab and Amyris
Very good diversification
The 3 months correlation between Ecolab and Amyris is -0.46. Overlapping area represents the amount of risk that can be diversified away by holding Ecolab Inc and Amyris Inc in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Amyris Inc and Ecolab 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 Ecolab Inc are associated (or correlated) with Amyris. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Amyris Inc has no effect on the direction of Ecolab i.e., Ecolab and Amyris go up and down completely randomly.
Pair Corralation between Ecolab and Amyris
If you would invest 23,432 in Ecolab Inc on November 1, 2024 and sell it today you would earn a total of 1,261 from holding Ecolab Inc or generate 5.38% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 5.26% |
| Values | Daily Returns |
Ecolab Inc vs. Amyris Inc
Performance |
| Timeline |
| Ecolab Inc |
| Amyris Inc |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Very Weak
Ecolab and Amyris Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Ecolab and Amyris
The main advantage of trading using opposite Ecolab and Amyris positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Ecolab position performs unexpectedly, Amyris 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 Amyris will offset losses from the drop in Amyris' long position.| Ecolab vs. Linde plc Ordinary | Ecolab vs. PPG Industries | Ecolab vs. Sherwin Williams Co | Ecolab vs. LyondellBasell Industries NV |
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 Portfolio Backtesting module to avoid under-diversification and over-optimization by backtesting your portfolios.
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