Correlation Between Eltek and ChromoCure
Can any of the company-specific risk be diversified away by investing in both Eltek and ChromoCure 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 ChromoCure into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Eltek and ChromoCure, you can compare the effects of market volatilities on Eltek and ChromoCure 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 ChromoCure. Check out your portfolio center. Please also check ongoing floating volatility patterns of Eltek and ChromoCure.
Diversification Opportunities for Eltek and ChromoCure
0.35 | Correlation Coefficient |
Weak diversification
The 3 months correlation between Eltek and ChromoCure is 0.35. Overlapping area represents the amount of risk that can be diversified away by holding Eltek and ChromoCure in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on ChromoCure 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 ChromoCure. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of ChromoCure has no effect on the direction of Eltek i.e., Eltek and ChromoCure go up and down completely randomly.
Pair Corralation between Eltek and ChromoCure
If you would invest 1,060 in Eltek on October 13, 2024 and sell it today you would earn a total of 46.00 from holding Eltek or generate 4.34% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 0.0% |
| Values | Daily Returns |
Eltek vs. ChromoCure
Performance |
| Timeline |
| Eltek |
| ChromoCure |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Very Weak
Eltek and ChromoCure Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Eltek and ChromoCure
The main advantage of trading using opposite Eltek and ChromoCure positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Eltek position performs unexpectedly, ChromoCure 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 ChromoCure will offset losses from the drop in ChromoCure's long position.| Eltek vs. Methode Electronics | Eltek vs. OSI Systems | Eltek vs. Bel Fuse A | Eltek vs. Richardson Electronics |
| ChromoCure vs. 51Talk Online Education | ChromoCure vs. NetEase | ChromoCure vs. Skillful Craftsman Education | ChromoCure vs. Eltek |
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 Holdings module to check your current holdings and cash postion to detemine if your portfolio needs rebalancing.
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