Correlation Between Enel Chile and Colbun
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By analyzing existing cross correlation between Enel Chile SA and Colbun, you can compare the effects of market volatilities on Enel Chile and Colbun 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 Enel Chile with a short position of Colbun. Check out your portfolio center. Please also check ongoing floating volatility patterns of Enel Chile and Colbun.
Diversification Opportunities for Enel Chile and Colbun
-0.52 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between Enel and Colbun is -0.52. Overlapping area represents the amount of risk that can be diversified away by holding Enel Chile SA and Colbun in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Colbun and Enel Chile 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 Enel Chile SA are associated (or correlated) with Colbun. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Colbun has no effect on the direction of Enel Chile i.e., Enel Chile and Colbun go up and down completely randomly.
Pair Corralation between Enel Chile and Colbun
Assuming the 90 days trading horizon Enel Chile is expected to generate 1.24 times less return on investment than Colbun. In addition to that, Enel Chile is 1.18 times more volatile than Colbun. It trades about 0.06 of its total potential returns per unit of risk. Colbun is currently generating about 0.08 per unit of volatility. If you would invest 6,956 in Colbun on August 28, 2024 and sell it today you would earn a total of 5,019 from holding Colbun or generate 72.15% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Enel Chile SA vs. Colbun
Performance |
| Timeline |
| Enel Chile SA |
| Colbun |
Enel Chile and Colbun Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Enel Chile and Colbun
The main advantage of trading using opposite Enel Chile and Colbun positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Enel Chile position performs unexpectedly, Colbun 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 Colbun will offset losses from the drop in Colbun's long position.| Enel Chile vs. Enel Amricas SA | Enel Chile vs. Banco de Chile | Enel Chile vs. Banco Santander Chile | Enel Chile vs. Colbun |
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 AI Portfolio Architect module to use AI to generate optimal portfolios and find profitable investment opportunities.
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