Correlation Between Easy Software and BANK CENTRAL
Can any of the company-specific risk be diversified away by investing in both Easy Software and BANK CENTRAL 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 Easy Software and BANK CENTRAL into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Easy Software AG and BANK CENTRAL ASIA, you can compare the effects of market volatilities on Easy Software and BANK CENTRAL 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 Easy Software with a short position of BANK CENTRAL. Check out your portfolio center. Please also check ongoing floating volatility patterns of Easy Software and BANK CENTRAL.
Diversification Opportunities for Easy Software and BANK CENTRAL
-0.37 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Easy and BANK is -0.37. Overlapping area represents the amount of risk that can be diversified away by holding Easy Software AG and BANK CENTRAL ASIA in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on BANK CENTRAL ASIA and Easy Software 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 Easy Software AG are associated (or correlated) with BANK CENTRAL. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of BANK CENTRAL ASIA has no effect on the direction of Easy Software i.e., Easy Software and BANK CENTRAL go up and down completely randomly.
Pair Corralation between Easy Software and BANK CENTRAL
Assuming the 90 days trading horizon Easy Software AG is expected to generate 1.87 times more return on investment than BANK CENTRAL. However, Easy Software is 1.87 times more volatile than BANK CENTRAL ASIA. It trades about 0.02 of its potential returns per unit of risk. BANK CENTRAL ASIA is currently generating about 0.02 per unit of risk. If you would invest 1,578 in Easy Software AG on October 30, 2024 and sell it today you would earn a total of 172.00 from holding Easy Software AG or generate 10.9% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 99.75% |
| Values | Daily Returns |
Easy Software AG vs. BANK CENTRAL ASIA
Performance |
| Timeline |
| Easy Software AG |
| BANK CENTRAL ASIA |
Easy Software and BANK CENTRAL Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Easy Software and BANK CENTRAL
The main advantage of trading using opposite Easy Software and BANK CENTRAL positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Easy Software position performs unexpectedly, BANK CENTRAL 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 BANK CENTRAL will offset losses from the drop in BANK CENTRAL's long position.| Easy Software vs. ScanSource | Easy Software vs. MOVIE GAMES SA | Easy Software vs. CanSino Biologics | Easy Software vs. DFS Furniture PLC |
| BANK CENTRAL vs. COSTCO WHOLESALE CDR | BANK CENTRAL vs. RETAIL FOOD GROUP | BANK CENTRAL vs. CEOTRONICS | BANK CENTRAL vs. Perdoceo Education |
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 Money Managers module to screen money managers from public funds and ETFs managed around the world.
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