Correlation Between Eos Energy and Glory Star
Can any of the company-specific risk be diversified away by investing in both Eos Energy and Glory Star 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 Eos Energy and Glory Star into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Eos Energy Enterprises and Glory Star New, you can compare the effects of market volatilities on Eos Energy and Glory Star 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 Eos Energy with a short position of Glory Star. Check out your portfolio center. Please also check ongoing floating volatility patterns of Eos Energy and Glory Star.
Diversification Opportunities for Eos Energy and Glory Star
0.24 | Correlation Coefficient |
Modest diversification
The 3 months correlation between Eos and Glory is 0.24. Overlapping area represents the amount of risk that can be diversified away by holding Eos Energy Enterprises and Glory Star New in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Glory Star New and Eos Energy 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 Eos Energy Enterprises are associated (or correlated) with Glory Star. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Glory Star New has no effect on the direction of Eos Energy i.e., Eos Energy and Glory Star go up and down completely randomly.
Pair Corralation between Eos Energy and Glory Star
Assuming the 90 days horizon Eos Energy is expected to generate 145.68 times less return on investment than Glory Star. But when comparing it to its historical volatility, Eos Energy Enterprises is 16.81 times less risky than Glory Star. It trades about 0.02 of its potential returns per unit of risk. Glory Star New is currently generating about 0.2 of returns per unit of risk over similar time horizon. If you would invest 0.00 in Glory Star New on August 29, 2024 and sell it today you would earn a total of 0.13 from holding Glory Star New or generate 9.223372036854776E16% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 70.31% |
| Values | Daily Returns |
Eos Energy Enterprises vs. Glory Star New
Performance |
| Timeline |
| Eos Energy Enterprises |
| Glory Star New |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Good
Eos Energy and Glory Star Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Eos Energy and Glory Star
The main advantage of trading using opposite Eos Energy and Glory Star positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Eos Energy position performs unexpectedly, Glory Star 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 Glory Star will offset losses from the drop in Glory Star's long position.| Eos Energy vs. Eos Energy Enterprises | Eos Energy vs. CuriosityStream | Eos Energy vs. GCM Grosvenor | Eos Energy vs. Canoo 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 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.
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