Correlation Between Elton International and Ekter SA
Can any of the company-specific risk be diversified away by investing in both Elton International and Ekter SA 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 Elton International and Ekter SA into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Elton International Trading and Ekter SA, you can compare the effects of market volatilities on Elton International and Ekter SA 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 Elton International with a short position of Ekter SA. Check out your portfolio center. Please also check ongoing floating volatility patterns of Elton International and Ekter SA.
Diversification Opportunities for Elton International and Ekter SA
0.42 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Elton and Ekter is 0.42. Overlapping area represents the amount of risk that can be diversified away by holding Elton International Trading and Ekter SA in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Ekter SA and Elton International 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 Elton International Trading are associated (or correlated) with Ekter SA. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Ekter SA has no effect on the direction of Elton International i.e., Elton International and Ekter SA go up and down completely randomly.
Pair Corralation between Elton International and Ekter SA
Assuming the 90 days trading horizon Elton International Trading is expected to generate 0.58 times more return on investment than Ekter SA. However, Elton International Trading is 1.74 times less risky than Ekter SA. It trades about -0.14 of its potential returns per unit of risk. Ekter SA is currently generating about -0.11 per unit of risk. If you would invest 187.00 in Elton International Trading on November 5, 2024 and sell it today you would lose (7.00) from holding Elton International Trading or give up 3.74% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Elton International Trading vs. Ekter SA
Performance |
| Timeline |
| Elton International |
| Ekter SA |
Elton International and Ekter SA Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Elton International and Ekter SA
The main advantage of trading using opposite Elton International and Ekter SA positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Elton International position performs unexpectedly, Ekter SA 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 Ekter SA will offset losses from the drop in Ekter SA's long position.| Elton International vs. Autohellas SA | Elton International vs. Admie Holding SA | Elton International vs. Hellenic Petroleum SA | Elton International vs. Jumbo SA |
| Ekter SA vs. Avax SA | Ekter SA vs. Intracom Constructions Societe | Ekter SA vs. Alumil Aluminium Industry | Ekter SA vs. GEK TERNA Holdings |
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 Idea Optimizer module to use advanced portfolio builder with pre-computed micro ideas to build optimal portfolio .
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