Correlation Between EJF Investments and Various Eateries
Can any of the company-specific risk be diversified away by investing in both EJF Investments and Various Eateries 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 EJF Investments and Various Eateries into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between EJF Investments and Various Eateries PLC, you can compare the effects of market volatilities on EJF Investments and Various Eateries 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 EJF Investments with a short position of Various Eateries. Check out your portfolio center. Please also check ongoing floating volatility patterns of EJF Investments and Various Eateries.
Diversification Opportunities for EJF Investments and Various Eateries
-0.89 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between EJF and Various is -0.89. Overlapping area represents the amount of risk that can be diversified away by holding EJF Investments and Various Eateries PLC in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Various Eateries PLC and EJF Investments 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 EJF Investments are associated (or correlated) with Various Eateries. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Various Eateries PLC has no effect on the direction of EJF Investments i.e., EJF Investments and Various Eateries go up and down completely randomly.
Pair Corralation between EJF Investments and Various Eateries
Assuming the 90 days trading horizon EJF Investments is expected to generate 2.22 times more return on investment than Various Eateries. However, EJF Investments is 2.22 times more volatile than Various Eateries PLC. It trades about -0.01 of its potential returns per unit of risk. Various Eateries PLC is currently generating about -0.32 per unit of risk. If you would invest 11,900 in EJF Investments on November 4, 2024 and sell it today you would lose (100.00) from holding EJF Investments or give up 0.84% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Significant |
| Accuracy | 95.45% |
| Values | Daily Returns |
EJF Investments vs. Various Eateries PLC
Performance |
| Timeline |
| EJF Investments |
| Various Eateries PLC |
EJF Investments and Various Eateries Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with EJF Investments and Various Eateries
The main advantage of trading using opposite EJF Investments and Various Eateries positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if EJF Investments position performs unexpectedly, Various Eateries 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 Various Eateries will offset losses from the drop in Various Eateries' long position.| EJF Investments vs. Leroy Seafood Group | EJF Investments vs. Edita Food Industries | EJF Investments vs. Virgin Wines UK | EJF Investments vs. Austevoll Seafood ASA |
| Various Eateries vs. MTI Wireless Edge | Various Eateries vs. Zoom Video Communications | Various Eateries vs. Gruppo MutuiOnline SpA | Various Eateries vs. Wizz Air Holdings |
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 CEOs Directory module to screen CEOs from public companies around the world.
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