Correlation Between Ellomay Capital and Brookfield Infrastructure
Can any of the company-specific risk be diversified away by investing in both Ellomay Capital and Brookfield Infrastructure 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 Ellomay Capital and Brookfield Infrastructure into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Ellomay Capital and Brookfield Infrastructure Partners, you can compare the effects of market volatilities on Ellomay Capital and Brookfield Infrastructure 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 Ellomay Capital with a short position of Brookfield Infrastructure. Check out your portfolio center. Please also check ongoing floating volatility patterns of Ellomay Capital and Brookfield Infrastructure.
Diversification Opportunities for Ellomay Capital and Brookfield Infrastructure
-0.44 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Ellomay and Brookfield is -0.44. Overlapping area represents the amount of risk that can be diversified away by holding Ellomay Capital and Brookfield Infrastructure Part in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Brookfield Infrastructure and Ellomay Capital 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 Ellomay Capital are associated (or correlated) with Brookfield Infrastructure. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Brookfield Infrastructure has no effect on the direction of Ellomay Capital i.e., Ellomay Capital and Brookfield Infrastructure go up and down completely randomly.
Pair Corralation between Ellomay Capital and Brookfield Infrastructure
Given the investment horizon of 90 days Ellomay Capital is expected to generate 1.04 times less return on investment than Brookfield Infrastructure. In addition to that, Ellomay Capital is 2.42 times more volatile than Brookfield Infrastructure Partners. It trades about 0.04 of its total potential returns per unit of risk. Brookfield Infrastructure Partners is currently generating about 0.09 per unit of volatility. If you would invest 1,696 in Brookfield Infrastructure Partners on August 31, 2024 and sell it today you would earn a total of 229.00 from holding Brookfield Infrastructure Partners or generate 13.5% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 93.65% |
| Values | Daily Returns |
Ellomay Capital vs. Brookfield Infrastructure Part
Performance |
| Timeline |
| Ellomay Capital |
| Brookfield Infrastructure |
Ellomay Capital and Brookfield Infrastructure Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Ellomay Capital and Brookfield Infrastructure
The main advantage of trading using opposite Ellomay Capital and Brookfield Infrastructure positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Ellomay Capital position performs unexpectedly, Brookfield Infrastructure 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 Brookfield Infrastructure will offset losses from the drop in Brookfield Infrastructure's long position.| Ellomay Capital vs. Verde Clean Fuels | Ellomay Capital vs. Eco Wave Power | Ellomay Capital vs. Fluence Energy | Ellomay Capital vs. Advent Technologies Holdings |
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 Portfolio Dashboard module to portfolio dashboard that provides centralized access to all your investments.
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