Correlation Between Elecnor SA and Iffe Futura
Can any of the company-specific risk be diversified away by investing in both Elecnor SA and Iffe Futura 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 Iffe Futura into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Elecnor SA and Iffe Futura SA, you can compare the effects of market volatilities on Elecnor SA and Iffe Futura 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 Iffe Futura. Check out your portfolio center. Please also check ongoing floating volatility patterns of Elecnor SA and Iffe Futura.
Diversification Opportunities for Elecnor SA and Iffe Futura
0.22 | Correlation Coefficient |
Modest diversification
The 3 months correlation between Elecnor and Iffe is 0.22. Overlapping area represents the amount of risk that can be diversified away by holding Elecnor SA and Iffe Futura SA in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Iffe Futura SA 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 Iffe Futura. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Iffe Futura SA has no effect on the direction of Elecnor SA i.e., Elecnor SA and Iffe Futura go up and down completely randomly.
Pair Corralation between Elecnor SA and Iffe Futura
Assuming the 90 days trading horizon Elecnor SA is expected to generate 0.51 times more return on investment than Iffe Futura. However, Elecnor SA is 1.95 times less risky than Iffe Futura. It trades about 0.04 of its potential returns per unit of risk. Iffe Futura SA is currently generating about 0.0 per unit of risk. If you would invest 1,821 in Elecnor SA on September 2, 2024 and sell it today you would earn a total of 214.00 from holding Elecnor SA or generate 11.75% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Elecnor SA vs. Iffe Futura SA
Performance |
| Timeline |
| Elecnor SA |
| Iffe Futura SA |
Elecnor SA and Iffe Futura Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Elecnor SA and Iffe Futura
The main advantage of trading using opposite Elecnor SA and Iffe Futura positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Elecnor SA position performs unexpectedly, Iffe Futura 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 Iffe Futura will offset losses from the drop in Iffe Futura'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 |
| Iffe Futura vs. Metrovacesa SA | Iffe Futura vs. Elecnor SA | Iffe Futura vs. Mapfre | Iffe Futura 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 Pattern Recognition module to use different Pattern Recognition models to time the market across multiple global exchanges.
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