Correlation Between Electroprecizia and Promateris
Can any of the company-specific risk be diversified away by investing in both Electroprecizia and Promateris 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 Electroprecizia and Promateris into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Electroprecizia SA and Promateris SA, you can compare the effects of market volatilities on Electroprecizia and Promateris 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 Electroprecizia with a short position of Promateris. Check out your portfolio center. Please also check ongoing floating volatility patterns of Electroprecizia and Promateris.
Diversification Opportunities for Electroprecizia and Promateris
-0.44 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Electroprecizia and Promateris is -0.44. Overlapping area represents the amount of risk that can be diversified away by holding Electroprecizia SA and Promateris SA in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Promateris SA and Electroprecizia 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 Electroprecizia SA are associated (or correlated) with Promateris. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Promateris SA has no effect on the direction of Electroprecizia i.e., Electroprecizia and Promateris go up and down completely randomly.
Pair Corralation between Electroprecizia and Promateris
Assuming the 90 days trading horizon Electroprecizia SA is expected to generate 1.06 times more return on investment than Promateris. However, Electroprecizia is 1.06 times more volatile than Promateris SA. It trades about 0.03 of its potential returns per unit of risk. Promateris SA is currently generating about -0.02 per unit of risk. If you would invest 1,230 in Electroprecizia SA on August 29, 2024 and sell it today you would earn a total of 160.00 from holding Electroprecizia SA or generate 13.01% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 86.65% |
| Values | Daily Returns |
Electroprecizia SA vs. Promateris SA
Performance |
| Timeline |
| Electroprecizia SA |
| Promateris SA |
Electroprecizia and Promateris Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Electroprecizia and Promateris
The main advantage of trading using opposite Electroprecizia and Promateris positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Electroprecizia position performs unexpectedly, Promateris 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 Promateris will offset losses from the drop in Promateris' long position.| Electroprecizia vs. Teraplast Bist | Electroprecizia vs. Electroarges S | Electroprecizia vs. Comvex SA | Electroprecizia vs. IAR SA |
| Promateris vs. TRANSILVANIA LEASING SI | Promateris vs. Evergent Investments SA | Promateris vs. AROBS TRANSILVANIA SOFTWARE | Promateris vs. IHUNT TECHNOLOGY IMPORT EXPORT |
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 Volatility Analysis module to get historical volatility and risk analysis based on latest market data.
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