Correlation Between Ekinops SA and Aubay Socit
Can any of the company-specific risk be diversified away by investing in both Ekinops SA and Aubay Socit 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 Aubay Socit into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Ekinops SA and Aubay Socit Anonyme, you can compare the effects of market volatilities on Ekinops SA and Aubay Socit 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 Aubay Socit. Check out your portfolio center. Please also check ongoing floating volatility patterns of Ekinops SA and Aubay Socit.
Diversification Opportunities for Ekinops SA and Aubay Socit
0.69 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Ekinops and Aubay is 0.69. Overlapping area represents the amount of risk that can be diversified away by holding Ekinops SA and Aubay Socit Anonyme in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Aubay Socit Anonyme 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 Aubay Socit. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Aubay Socit Anonyme has no effect on the direction of Ekinops SA i.e., Ekinops SA and Aubay Socit go up and down completely randomly.
Pair Corralation between Ekinops SA and Aubay Socit
Assuming the 90 days trading horizon Ekinops SA is expected to under-perform the Aubay Socit. In addition to that, Ekinops SA is 2.48 times more volatile than Aubay Socit Anonyme. It trades about -0.23 of its total potential returns per unit of risk. Aubay Socit Anonyme is currently generating about -0.02 per unit of volatility. If you would invest 4,501 in Aubay Socit Anonyme on August 30, 2024 and sell it today you would lose (26.00) from holding Aubay Socit Anonyme or give up 0.58% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Ekinops SA vs. Aubay Socit Anonyme
Performance |
| Timeline |
| Ekinops SA |
| Aubay Socit Anonyme |
Ekinops SA and Aubay Socit Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Ekinops SA and Aubay Socit
The main advantage of trading using opposite Ekinops SA and Aubay Socit positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Ekinops SA position performs unexpectedly, Aubay Socit 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 Aubay Socit will offset losses from the drop in Aubay Socit's long position.| Ekinops SA vs. Claranova SE | Ekinops SA vs. Derichebourg | Ekinops SA vs. Mersen SA | Ekinops SA vs. BigBen Interactive |
| Aubay Socit vs. Neurones | Aubay Socit vs. Infotel SA | Aubay Socit vs. Alten SA | Aubay Socit vs. Wavestone 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 Performance Analysis module to check effects of mean-variance optimization against your current asset allocation.
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