Correlation Between Ekinops SA and Grolleau SAS
Can any of the company-specific risk be diversified away by investing in both Ekinops SA and Grolleau SAS 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 Ekinops SA and Grolleau SAS into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Ekinops SA and Grolleau SAS, you can compare the effects of market volatilities on Ekinops SA and Grolleau SAS 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 Ekinops SA with a short position of Grolleau SAS. Check out your portfolio center. Please also check ongoing floating volatility patterns of Ekinops SA and Grolleau SAS.
Diversification Opportunities for Ekinops SA and Grolleau SAS
-0.52 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between Ekinops and Grolleau is -0.52. Overlapping area represents the amount of risk that can be diversified away by holding Ekinops SA and Grolleau SAS in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Grolleau SAS and Ekinops SA 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 Ekinops SA are associated (or correlated) with Grolleau SAS. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Grolleau SAS has no effect on the direction of Ekinops SA i.e., Ekinops SA and Grolleau SAS go up and down completely randomly.
Pair Corralation between Ekinops SA and Grolleau SAS
Assuming the 90 days trading horizon Ekinops SA is expected to under-perform the Grolleau SAS. But the stock apears to be less risky and, when comparing its historical volatility, Ekinops SA is 1.62 times less risky than Grolleau SAS. The stock trades about -0.25 of its potential returns per unit of risk. The Grolleau SAS is currently generating about 0.1 of returns per unit of risk over similar time horizon. If you would invest 389.00 in Grolleau SAS on September 1, 2024 and sell it today you would earn a total of 29.00 from holding Grolleau SAS or generate 7.46% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 95.65% |
| Values | Daily Returns |
Ekinops SA vs. Grolleau SAS
Performance |
| Timeline |
| Ekinops SA |
| Grolleau SAS |
Ekinops SA and Grolleau SAS Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Ekinops SA and Grolleau SAS
The main advantage of trading using opposite Ekinops SA and Grolleau SAS positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Ekinops SA position performs unexpectedly, Grolleau SAS 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 Grolleau SAS will offset losses from the drop in Grolleau SAS's long position.| Ekinops SA vs. Claranova SE | Ekinops SA vs. Derichebourg | Ekinops SA vs. Mersen SA | Ekinops SA vs. BigBen Interactive |
| Grolleau SAS vs. Berkem Group SA | Grolleau SAS vs. Waga Energy SA | Grolleau SAS vs. Entech SE SAS | Grolleau SAS vs. Orapi 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 Aroon Oscillator module to analyze current equity momentum using Aroon Oscillator and other momentum ratios.
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