Correlation Between Eguana Technologies and Loop Energy
Can any of the company-specific risk be diversified away by investing in both Eguana Technologies and Loop Energy 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 Eguana Technologies and Loop Energy into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Eguana Technologies and Loop Energy, you can compare the effects of market volatilities on Eguana Technologies and Loop Energy 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 Eguana Technologies with a short position of Loop Energy. Check out your portfolio center. Please also check ongoing floating volatility patterns of Eguana Technologies and Loop Energy.
Diversification Opportunities for Eguana Technologies and Loop Energy
0.0 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between Eguana and Loop is 0.0. Overlapping area represents the amount of risk that can be diversified away by holding Eguana Technologies and Loop Energy in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Loop Energy and Eguana Technologies 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 Eguana Technologies are associated (or correlated) with Loop Energy. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Loop Energy has no effect on the direction of Eguana Technologies i.e., Eguana Technologies and Loop Energy go up and down completely randomly.
Pair Corralation between Eguana Technologies and Loop Energy
Assuming the 90 days horizon Eguana Technologies is expected to generate 6.72 times less return on investment than Loop Energy. But when comparing it to its historical volatility, Eguana Technologies is 2.82 times less risky than Loop Energy. It trades about 0.01 of its potential returns per unit of risk. Loop Energy is currently generating about 0.03 of returns per unit of risk over similar time horizon. If you would invest 93.00 in Loop Energy on August 28, 2024 and sell it today you would lose (85.00) from holding Loop Energy or give up 91.4% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Flat |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Eguana Technologies vs. Loop Energy
Performance |
| Timeline |
| Eguana Technologies |
| Loop Energy |
Eguana Technologies and Loop Energy Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Eguana Technologies and Loop Energy
The main advantage of trading using opposite Eguana Technologies and Loop Energy positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Eguana Technologies position performs unexpectedly, Loop Energy 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 Loop Energy will offset losses from the drop in Loop Energy's long position.| Eguana Technologies vs. Element Solutions | Eguana Technologies vs. Orion Engineered Carbons | Eguana Technologies vs. Minerals Technologies | Eguana Technologies vs. Ingevity Corp |
| Loop Energy vs. Legrand SA ADR | Loop Energy vs. AFC Energy plc | Loop Energy vs. Sunrise New Energy | Loop Energy vs. Tantalus Systems Holding |
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 Volatility Analysis module to get historical volatility and risk analysis based on latest market data.
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