Correlation Between Electra Battery and ISign Media
Can any of the company-specific risk be diversified away by investing in both Electra Battery and ISign Media 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 Electra Battery and ISign Media into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Electra Battery Materials and iSign Media Solutions, you can compare the effects of market volatilities on Electra Battery and ISign Media 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 Electra Battery with a short position of ISign Media. Check out your portfolio center. Please also check ongoing floating volatility patterns of Electra Battery and ISign Media.
Diversification Opportunities for Electra Battery and ISign Media
0.07 | Correlation Coefficient |
Significant diversification
The 3 months correlation between Electra and ISign is 0.07. Overlapping area represents the amount of risk that can be diversified away by holding Electra Battery Materials and iSign Media Solutions in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on iSign Media Solutions and Electra Battery 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 Electra Battery Materials are associated (or correlated) with ISign Media. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of iSign Media Solutions has no effect on the direction of Electra Battery i.e., Electra Battery and ISign Media go up and down completely randomly.
Pair Corralation between Electra Battery and ISign Media
Assuming the 90 days trading horizon Electra Battery Materials is expected to under-perform the ISign Media. In addition to that, Electra Battery is 2.76 times more volatile than iSign Media Solutions. It trades about -0.2 of its total potential returns per unit of risk. iSign Media Solutions is currently generating about 0.13 per unit of volatility. If you would invest 1,380 in iSign Media Solutions on September 5, 2024 and sell it today you would earn a total of 36.00 from holding iSign Media Solutions or generate 2.61% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 95.65% |
| Values | Daily Returns |
Electra Battery Materials vs. iSign Media Solutions
Performance |
| Timeline |
| Electra Battery Materials |
| iSign Media Solutions |
Electra Battery and ISign Media Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Electra Battery and ISign Media
The main advantage of trading using opposite Electra Battery and ISign Media positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Electra Battery position performs unexpectedly, ISign Media 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 ISign Media will offset losses from the drop in ISign Media's long position.| Electra Battery vs. Frontier Lithium | Electra Battery vs. Electra Battery Materials | Electra Battery vs. E3 Lithium | Electra Battery vs. Canada Nickel |
| ISign Media vs. Quisitive Technology Solutions | ISign Media vs. Labrador Iron Ore | ISign Media vs. Gfl Environmental Holdings | ISign Media vs. Electra Battery Materials |
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 Sync Your Broker module to sync your existing holdings, watchlists, positions or portfolios from thousands of online brokerage services, banks, investment account aggregators and robo-advisors..
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