Correlation Between Elopak AS and ECIT AS
Can any of the company-specific risk be diversified away by investing in both Elopak AS and ECIT AS 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 Elopak AS and ECIT AS into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Elopak AS and ECIT AS, you can compare the effects of market volatilities on Elopak AS and ECIT AS 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 Elopak AS with a short position of ECIT AS. Check out your portfolio center. Please also check ongoing floating volatility patterns of Elopak AS and ECIT AS.
Diversification Opportunities for Elopak AS and ECIT AS
Average diversification
The 3 months correlation between Elopak and ECIT is 0.18. Overlapping area represents the amount of risk that can be diversified away by holding Elopak AS and ECIT AS in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on ECIT AS and Elopak AS 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 Elopak AS are associated (or correlated) with ECIT AS. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of ECIT AS has no effect on the direction of Elopak AS i.e., Elopak AS and ECIT AS go up and down completely randomly.
Pair Corralation between Elopak AS and ECIT AS
If you would invest 4,400 in Elopak AS on September 14, 2024 and sell it today you would earn a total of 80.00 from holding Elopak AS or generate 1.82% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 50.0% |
| Values | Daily Returns |
Elopak AS vs. ECIT AS
Performance |
| Timeline |
| Elopak AS |
| ECIT AS |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Very Weak
Elopak AS and ECIT AS Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Elopak AS and ECIT AS
The main advantage of trading using opposite Elopak AS and ECIT AS positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Elopak AS position performs unexpectedly, ECIT AS 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 ECIT AS will offset losses from the drop in ECIT AS's long position.| Elopak AS vs. Elkem ASA | Elopak AS vs. Norske Skog Asa | Elopak AS vs. Kitron ASA | Elopak AS vs. Europris ASA |
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 Theme Ratings module to determine theme ratings based on digital equity recommendations. Macroaxis theme ratings are based on combination of fundamental analysis and risk-adjusted market performance.
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