Correlation Between Ellomay Capital and Companhia Paranaense
Can any of the company-specific risk be diversified away by investing in both Ellomay Capital and Companhia Paranaense 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 Companhia Paranaense into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Ellomay Capital and Companhia Paranaense de, you can compare the effects of market volatilities on Ellomay Capital and Companhia Paranaense 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 Companhia Paranaense. Check out your portfolio center. Please also check ongoing floating volatility patterns of Ellomay Capital and Companhia Paranaense.
Diversification Opportunities for Ellomay Capital and Companhia Paranaense
-0.61 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between Ellomay and Companhia is -0.61. Overlapping area represents the amount of risk that can be diversified away by holding Ellomay Capital and Companhia Paranaense de in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Companhia Paranaense 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 Companhia Paranaense. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Companhia Paranaense has no effect on the direction of Ellomay Capital i.e., Ellomay Capital and Companhia Paranaense go up and down completely randomly.
Pair Corralation between Ellomay Capital and Companhia Paranaense
Given the investment horizon of 90 days Ellomay Capital is expected to generate 1.15 times more return on investment than Companhia Paranaense. However, Ellomay Capital is 1.15 times more volatile than Companhia Paranaense de. It trades about 0.24 of its potential returns per unit of risk. Companhia Paranaense de is currently generating about -0.04 per unit of risk. If you would invest 1,408 in Ellomay Capital on August 30, 2024 and sell it today you would earn a total of 222.00 from holding Ellomay Capital or generate 15.77% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 95.65% |
| Values | Daily Returns |
Ellomay Capital vs. Companhia Paranaense de
Performance |
| Timeline |
| Ellomay Capital |
| Companhia Paranaense |
Ellomay Capital and Companhia Paranaense Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Ellomay Capital and Companhia Paranaense
The main advantage of trading using opposite Ellomay Capital and Companhia Paranaense positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Ellomay Capital position performs unexpectedly, Companhia Paranaense 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 Companhia Paranaense will offset losses from the drop in Companhia Paranaense's long position.| Ellomay Capital vs. Enlight Renewable Energy | Ellomay Capital vs. Renew Energy Global | Ellomay Capital vs. Clearway Energy Class | Ellomay Capital vs. Excelerate Energy |
| Companhia Paranaense vs. Encore Capital Group | Companhia Paranaense vs. Chemours Co | Companhia Paranaense vs. Siriuspoint | Companhia Paranaense vs. Freedom Bank of |
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 Companies Directory module to evaluate performance of over 100,000 Stocks, Funds, and ETFs against different fundamentals.
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