Correlation Between Ekinops SA and Icade SA
Can any of the company-specific risk be diversified away by investing in both Ekinops SA and Icade SA 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 Icade SA into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Ekinops SA and Icade SA, you can compare the effects of market volatilities on Ekinops SA and Icade SA 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 Icade SA. Check out your portfolio center. Please also check ongoing floating volatility patterns of Ekinops SA and Icade SA.
Diversification Opportunities for Ekinops SA and Icade SA
0.49 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Ekinops and Icade is 0.49. Overlapping area represents the amount of risk that can be diversified away by holding Ekinops SA and Icade SA in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Icade SA 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 Icade SA. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Icade SA has no effect on the direction of Ekinops SA i.e., Ekinops SA and Icade SA go up and down completely randomly.
Pair Corralation between Ekinops SA and Icade SA
Assuming the 90 days trading horizon Ekinops SA is expected to under-perform the Icade SA. In addition to that, Ekinops SA is 1.68 times more volatile than Icade SA. It trades about -0.04 of its total potential returns per unit of risk. Icade SA is currently generating about -0.04 per unit of volatility. If you would invest 2,771 in Icade SA on September 2, 2024 and sell it today you would lose (545.00) from holding Icade SA or give up 19.67% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Ekinops SA vs. Icade SA
Performance |
| Timeline |
| Ekinops SA |
| Icade SA |
Ekinops SA and Icade SA Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Ekinops SA and Icade SA
The main advantage of trading using opposite Ekinops SA and Icade SA positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Ekinops SA position performs unexpectedly, Icade SA 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 Icade SA will offset losses from the drop in Icade SA's long position.| Ekinops SA vs. Claranova SE | Ekinops SA vs. Derichebourg | Ekinops SA vs. Mersen SA | Ekinops SA vs. BigBen Interactive |
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 ETFs module to find actively traded Exchange Traded Funds (ETF) from around the world.
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