Correlation Between Ekinops SA and Invesco SP
Can any of the company-specific risk be diversified away by investing in both Ekinops SA and Invesco SP 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 Invesco SP into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Ekinops SA and Invesco SP 500, you can compare the effects of market volatilities on Ekinops SA and Invesco SP 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 Invesco SP. Check out your portfolio center. Please also check ongoing floating volatility patterns of Ekinops SA and Invesco SP.
Diversification Opportunities for Ekinops SA and Invesco SP
0.25 | Correlation Coefficient |
Modest diversification
The 3 months correlation between Ekinops and Invesco is 0.25. Overlapping area represents the amount of risk that can be diversified away by holding Ekinops SA and Invesco SP 500 in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Invesco SP 500 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 Invesco SP. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Invesco SP 500 has no effect on the direction of Ekinops SA i.e., Ekinops SA and Invesco SP go up and down completely randomly.
Pair Corralation between Ekinops SA and Invesco SP
Assuming the 90 days trading horizon Ekinops SA is expected to under-perform the Invesco SP. In addition to that, Ekinops SA is 2.94 times more volatile than Invesco SP 500. It trades about -0.04 of its total potential returns per unit of risk. Invesco SP 500 is currently generating about 0.12 per unit of volatility. If you would invest 5,096 in Invesco SP 500 on September 1, 2024 and sell it today you would earn a total of 863.00 from holding Invesco SP 500 or generate 16.93% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 97.69% |
| Values | Daily Returns |
Ekinops SA vs. Invesco SP 500
Performance |
| Timeline |
| Ekinops SA |
| Invesco SP 500 |
Ekinops SA and Invesco SP Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Ekinops SA and Invesco SP
The main advantage of trading using opposite Ekinops SA and Invesco SP positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Ekinops SA position performs unexpectedly, Invesco SP 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 Invesco SP will offset losses from the drop in Invesco SP's long position.| Ekinops SA vs. Claranova SE | Ekinops SA vs. Derichebourg | Ekinops SA vs. Mersen SA | Ekinops SA vs. BigBen Interactive |
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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 Stock Screener module to find equities using a custom stock filter or screen asymmetry in trading patterns, price, volume, or investment outlook..
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