Correlation Between Elecnor SA and International Consolidated
Can any of the company-specific risk be diversified away by investing in both Elecnor SA and International Consolidated 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 Elecnor SA and International Consolidated into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Elecnor SA and International Consolidated Airlines, you can compare the effects of market volatilities on Elecnor SA and International Consolidated 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 Elecnor SA with a short position of International Consolidated. Check out your portfolio center. Please also check ongoing floating volatility patterns of Elecnor SA and International Consolidated.
Diversification Opportunities for Elecnor SA and International Consolidated
0.73 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Elecnor and International is 0.73. Overlapping area represents the amount of risk that can be diversified away by holding Elecnor SA and International Consolidated Air in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on International Consolidated and Elecnor SA 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 Elecnor SA are associated (or correlated) with International Consolidated. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of International Consolidated has no effect on the direction of Elecnor SA i.e., Elecnor SA and International Consolidated go up and down completely randomly.
Pair Corralation between Elecnor SA and International Consolidated
Assuming the 90 days trading horizon Elecnor SA is expected to under-perform the International Consolidated. But the stock apears to be less risky and, when comparing its historical volatility, Elecnor SA is 1.59 times less risky than International Consolidated. The stock trades about -0.03 of its potential returns per unit of risk. The International Consolidated Airlines is currently generating about 0.18 of returns per unit of risk over similar time horizon. If you would invest 201.00 in International Consolidated Airlines on August 25, 2024 and sell it today you would earn a total of 95.00 from holding International Consolidated Airlines or generate 47.26% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Elecnor SA vs. International Consolidated Air
Performance |
| Timeline |
| Elecnor SA |
| International Consolidated |
Elecnor SA and International Consolidated Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Elecnor SA and International Consolidated
The main advantage of trading using opposite Elecnor SA and International Consolidated positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Elecnor SA position performs unexpectedly, International Consolidated 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 International Consolidated will offset losses from the drop in International Consolidated's long position.| Elecnor SA vs. Miquel y Costas | Elecnor SA vs. Construcciones y Auxiliar | Elecnor SA vs. Grupo Catalana Occidente | Elecnor SA vs. Tecnicas Reunidas |
| International Consolidated vs. Metrovacesa SA | International Consolidated vs. Elecnor SA | International Consolidated vs. Mapfre | International Consolidated vs. Amper SA |
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 Positions Ratings module to determine portfolio positions ratings based on digital equity recommendations. Macroaxis instant position ratings are based on combination of fundamental analysis and risk-adjusted market performance.
Other Complementary Tools
| Sync Your Broker Sync your existing holdings, watchlists, positions or portfolios from thousands of online brokerage services, banks, investment account aggregators and robo-advisors. | |
| Sign In To Macroaxis Sign in to explore Macroaxis' wealth optimization platform and fintech modules | |
| Financial Widgets Easily integrated Macroaxis content with over 30 different plug-and-play financial widgets | |
| Piotroski F Score Get Piotroski F Score based on the binary analysis strategy of nine different fundamentals | |
| Idea Optimizer Use advanced portfolio builder with pre-computed micro ideas to build optimal portfolio |