Correlation Between Easy Software and Peel Mining
Can any of the company-specific risk be diversified away by investing in both Easy Software and Peel Mining 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 Peel Mining 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 Peel Mining Limited, you can compare the effects of market volatilities on Easy Software and Peel Mining 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 Peel Mining. Check out your portfolio center. Please also check ongoing floating volatility patterns of Easy Software and Peel Mining.
Diversification Opportunities for Easy Software and Peel Mining
-0.04 | Correlation Coefficient |
Good diversification
The 3 months correlation between Easy and Peel is -0.04. Overlapping area represents the amount of risk that can be diversified away by holding Easy Software AG and Peel Mining Limited in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Peel Mining Limited 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 Peel Mining. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Peel Mining Limited has no effect on the direction of Easy Software i.e., Easy Software and Peel Mining go up and down completely randomly.
Pair Corralation between Easy Software and Peel Mining
Assuming the 90 days trading horizon Easy Software AG is expected to generate 0.86 times more return on investment than Peel Mining. However, Easy Software AG is 1.17 times less risky than Peel Mining. It trades about -0.1 of its potential returns per unit of risk. Peel Mining Limited is currently generating about -0.11 per unit of risk. If you would invest 1,890 in Easy Software AG on October 29, 2024 and sell it today you would lose (140.00) from holding Easy Software AG or give up 7.41% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 95.0% |
| Values | Daily Returns |
Easy Software AG vs. Peel Mining Limited
Performance |
| Timeline |
| Easy Software AG |
| Peel Mining Limited |
Easy Software and Peel Mining Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Easy Software and Peel Mining
The main advantage of trading using opposite Easy Software and Peel Mining positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Easy Software position performs unexpectedly, Peel Mining 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 Peel Mining will offset losses from the drop in Peel Mining's long position.| Easy Software vs. ScanSource | Easy Software vs. MOVIE GAMES SA | Easy Software vs. CanSino Biologics | Easy Software vs. DFS Furniture PLC |
| Peel Mining vs. Sunny Optical Technology | Peel Mining vs. Wayside Technology Group | Peel Mining vs. GRENKELEASING Dusseldorf | Peel Mining vs. FANDIFI TECHNOLOGY P |
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 Insider Screener module to find insiders across different sectors to evaluate their impact on performance.
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