Correlation Between Elong Power and Espey Mfg
Can any of the company-specific risk be diversified away by investing in both Elong Power and Espey Mfg 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 Elong Power and Espey Mfg into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Elong Power Holding and Espey Mfg Electronics, you can compare the effects of market volatilities on Elong Power and Espey Mfg 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 Elong Power with a short position of Espey Mfg. Check out your portfolio center. Please also check ongoing floating volatility patterns of Elong Power and Espey Mfg.
Diversification Opportunities for Elong Power and Espey Mfg
-0.37 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Elong and Espey is -0.37. Overlapping area represents the amount of risk that can be diversified away by holding Elong Power Holding and Espey Mfg Electronics in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Espey Mfg Electronics and Elong Power 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 Elong Power Holding are associated (or correlated) with Espey Mfg. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Espey Mfg Electronics has no effect on the direction of Elong Power i.e., Elong Power and Espey Mfg go up and down completely randomly.
Pair Corralation between Elong Power and Espey Mfg
Given the investment horizon of 90 days Elong Power Holding is expected to under-perform the Espey Mfg. In addition to that, Elong Power is 2.68 times more volatile than Espey Mfg Electronics. It trades about -0.15 of its total potential returns per unit of risk. Espey Mfg Electronics is currently generating about 0.11 per unit of volatility. If you would invest 2,062 in Espey Mfg Electronics on September 2, 2024 and sell it today you would earn a total of 956.00 from holding Espey Mfg Electronics or generate 46.36% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Elong Power Holding vs. Espey Mfg Electronics
Performance |
| Timeline |
| Elong Power Holding |
| Espey Mfg Electronics |
Elong Power and Espey Mfg Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Elong Power and Espey Mfg
The main advantage of trading using opposite Elong Power and Espey Mfg positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Elong Power position performs unexpectedly, Espey Mfg 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 Espey Mfg will offset losses from the drop in Espey Mfg's long position.| Elong Power vs. Bloom Energy Corp | Elong Power vs. Electrovaya Common Shares | Elong Power vs. Enovix Corp | Elong Power vs. Eos Energy Enterprises |
| Espey Mfg vs. Chicago Rivet Machine | Espey Mfg vs. Eastern Co | Espey Mfg vs. Servotronics | Espey Mfg vs. Evans Bancorp |
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 Equity Analysis module to research over 250,000 global equities including funds, stocks and ETFs to find investment opportunities.
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