Correlation Between Eltek and FT Cboe
Can any of the company-specific risk be diversified away by investing in both Eltek and FT Cboe 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 Eltek and FT Cboe into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Eltek and FT Cboe Vest, you can compare the effects of market volatilities on Eltek and FT Cboe 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 Eltek with a short position of FT Cboe. Check out your portfolio center. Please also check ongoing floating volatility patterns of Eltek and FT Cboe.
Diversification Opportunities for Eltek and FT Cboe
Very good diversification
The 3 months correlation between Eltek and IGLD is -0.28. Overlapping area represents the amount of risk that can be diversified away by holding Eltek and FT Cboe Vest in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on FT Cboe Vest and Eltek 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 Eltek are associated (or correlated) with FT Cboe. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of FT Cboe Vest has no effect on the direction of Eltek i.e., Eltek and FT Cboe go up and down completely randomly.
Pair Corralation between Eltek and FT Cboe
Given the investment horizon of 90 days Eltek is expected to generate 2.11 times more return on investment than FT Cboe. However, Eltek is 2.11 times more volatile than FT Cboe Vest. It trades about 0.02 of its potential returns per unit of risk. FT Cboe Vest is currently generating about 0.0 per unit of risk. If you would invest 1,091 in Eltek on August 29, 2024 and sell it today you would earn a total of 13.00 from holding Eltek or generate 1.19% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Eltek vs. FT Cboe Vest
Performance |
| Timeline |
| Eltek |
| FT Cboe Vest |
Eltek and FT Cboe Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Eltek and FT Cboe
The main advantage of trading using opposite Eltek and FT Cboe positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Eltek position performs unexpectedly, FT Cboe 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 FT Cboe will offset losses from the drop in FT Cboe's long position.| Eltek vs. Methode Electronics | Eltek vs. OSI Systems | Eltek vs. Bel Fuse A | Eltek vs. Richardson Electronics |
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 File Import module to quickly import all of your third-party portfolios from your local drive in csv format.
Other Complementary Tools
| Portfolio Manager State of the art Portfolio Manager to monitor and improve performance of your invested capital | |
| Watchlist Optimization Optimize watchlists to build efficient portfolios or rebalance existing positions based on the mean-variance optimization algorithm | |
| Money Flow Index Determine momentum by analyzing Money Flow Index and other technical indicators | |
| Price Exposure Probability Analyze equity upside and downside potential for a given time horizon across multiple markets | |
| Correlation Analysis Reduce portfolio risk simply by holding instruments which are not perfectly correlated |