Correlation Between Easy Software and Martifer SGPS
Can any of the company-specific risk be diversified away by investing in both Easy Software and Martifer SGPS 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 Martifer SGPS 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 Martifer SGPS SA, you can compare the effects of market volatilities on Easy Software and Martifer SGPS 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 Martifer SGPS. Check out your portfolio center. Please also check ongoing floating volatility patterns of Easy Software and Martifer SGPS.
Diversification Opportunities for Easy Software and Martifer SGPS
-0.05 | Correlation Coefficient |
Good diversification
The 3 months correlation between Easy and Martifer is -0.05. Overlapping area represents the amount of risk that can be diversified away by holding Easy Software AG and Martifer SGPS SA in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Martifer SGPS SA 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 Martifer SGPS. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Martifer SGPS SA has no effect on the direction of Easy Software i.e., Easy Software and Martifer SGPS go up and down completely randomly.
Pair Corralation between Easy Software and Martifer SGPS
Assuming the 90 days trading horizon Easy Software AG is expected to under-perform the Martifer SGPS. In addition to that, Easy Software is 2.84 times more volatile than Martifer SGPS SA. It trades about -0.02 of its total potential returns per unit of risk. Martifer SGPS SA is currently generating about 0.13 per unit of volatility. If you would invest 165.00 in Martifer SGPS SA on October 25, 2024 and sell it today you would earn a total of 5.00 from holding Martifer SGPS SA or generate 3.03% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 94.44% |
| Values | Daily Returns |
Easy Software AG vs. Martifer SGPS SA
Performance |
| Timeline |
| Easy Software AG |
| Martifer SGPS SA |
Easy Software and Martifer SGPS Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Easy Software and Martifer SGPS
The main advantage of trading using opposite Easy Software and Martifer SGPS positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Easy Software position performs unexpectedly, Martifer SGPS 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 Martifer SGPS will offset losses from the drop in Martifer SGPS's long position.| Easy Software vs. NXP Semiconductors NV | Easy Software vs. Ryanair Holdings plc | Easy Software vs. SEALED AIR | Easy Software vs. Corsair Gaming |
| Martifer SGPS vs. CANON MARKETING JP | Martifer SGPS vs. CarsalesCom | Martifer SGPS vs. Canadian Utilities Limited | Martifer SGPS vs. Tradeweb Markets |
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 Idea Analyzer module to analyze all characteristics, volatility and risk-adjusted return of Macroaxis ideas.
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