Correlation Between Eguana Technologies and Signify NV
Can any of the company-specific risk be diversified away by investing in both Eguana Technologies and Signify NV 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 Signify NV into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Eguana Technologies and Signify NV, you can compare the effects of market volatilities on Eguana Technologies and Signify NV 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 Signify NV. Check out your portfolio center. Please also check ongoing floating volatility patterns of Eguana Technologies and Signify NV.
Diversification Opportunities for Eguana Technologies and Signify NV
0.19 | Correlation Coefficient |
Average diversification
The 3 months correlation between Eguana and Signify is 0.19. Overlapping area represents the amount of risk that can be diversified away by holding Eguana Technologies and Signify NV in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Signify NV 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 Signify NV. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Signify NV has no effect on the direction of Eguana Technologies i.e., Eguana Technologies and Signify NV go up and down completely randomly.
Pair Corralation between Eguana Technologies and Signify NV
Assuming the 90 days horizon Eguana Technologies is expected to generate 7.92 times more return on investment than Signify NV. However, Eguana Technologies is 7.92 times more volatile than Signify NV. It trades about 0.05 of its potential returns per unit of risk. Signify NV is currently generating about -0.02 per unit of risk. If you would invest 2.00 in Eguana Technologies on August 24, 2024 and sell it today you would lose (1.57) from holding Eguana Technologies or give up 78.5% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 77.6% |
| Values | Daily Returns |
Eguana Technologies vs. Signify NV
Performance |
| Timeline |
| Eguana Technologies |
| Signify NV |
Eguana Technologies and Signify NV Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Eguana Technologies and Signify NV
The main advantage of trading using opposite Eguana Technologies and Signify NV positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Eguana Technologies position performs unexpectedly, Signify NV 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 Signify NV will offset losses from the drop in Signify NV's long position.| Eguana Technologies vs. Advanced Energy Industries | Eguana Technologies vs. Hubbell | Eguana Technologies vs. Tantalus Systems Holding | Eguana Technologies vs. Legrand SA ADR |
| Signify NV vs. Tantalus Systems Holding | Signify NV vs. AFC Energy plc | Signify NV vs. Loop Energy | Signify NV vs. CBAK Energy Technology |
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 Pattern Recognition module to use different Pattern Recognition models to time the market across multiple global exchanges.
Other Complementary Tools
| Fundamental Analysis View fundamental data based on most recent published financial statements | |
| Aroon Oscillator Analyze current equity momentum using Aroon Oscillator and other momentum ratios | |
| Equity Forecasting Use basic forecasting models to generate price predictions and determine price momentum | |
| Transaction History View history of all your transactions and understand their impact on performance | |
| USA ETFs Find actively traded Exchange Traded Funds (ETF) in USA |