Correlation Between ED Invest and Asseco South
Can any of the company-specific risk be diversified away by investing in both ED Invest and Asseco South 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 ED Invest and Asseco South into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between ED Invest SA and Asseco South Eastern, you can compare the effects of market volatilities on ED Invest and Asseco South 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 ED Invest with a short position of Asseco South. Check out your portfolio center. Please also check ongoing floating volatility patterns of ED Invest and Asseco South.
Diversification Opportunities for ED Invest and Asseco South
-0.52 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between EDI and Asseco is -0.52. Overlapping area represents the amount of risk that can be diversified away by holding ED Invest SA and Asseco South Eastern in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Asseco South Eastern and ED Invest 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 ED Invest SA are associated (or correlated) with Asseco South. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Asseco South Eastern has no effect on the direction of ED Invest i.e., ED Invest and Asseco South go up and down completely randomly.
Pair Corralation between ED Invest and Asseco South
Assuming the 90 days trading horizon ED Invest SA is expected to generate 2.84 times more return on investment than Asseco South. However, ED Invest is 2.84 times more volatile than Asseco South Eastern. It trades about 0.2 of its potential returns per unit of risk. Asseco South Eastern is currently generating about -0.12 per unit of risk. If you would invest 560.00 in ED Invest SA on September 4, 2024 and sell it today you would earn a total of 88.00 from holding ED Invest SA or generate 15.71% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
ED Invest SA vs. Asseco South Eastern
Performance |
| Timeline |
| ED Invest SA |
| Asseco South Eastern |
ED Invest and Asseco South Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with ED Invest and Asseco South
The main advantage of trading using opposite ED Invest and Asseco South positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if ED Invest position performs unexpectedly, Asseco South 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 South will offset losses from the drop in Asseco South's long position.| ED Invest vs. Monnari Trade SA | ED Invest vs. New Tech Venture | ED Invest vs. Skyline Investment SA | ED Invest vs. Tower Investments SA |
| Asseco South vs. New Tech Venture | Asseco South vs. Kool2play SA | Asseco South vs. Cloud Technologies SA | Asseco South vs. Saule Technologies 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 Portfolio Suggestion module to get suggestions outside of your existing asset allocation including your own model portfolios.
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