Correlation Between Energy Transfer and Ellomay Capital
Can any of the company-specific risk be diversified away by investing in both Energy Transfer and Ellomay Capital 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 Energy Transfer and Ellomay Capital into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Energy Transfer LP and Ellomay Capital, you can compare the effects of market volatilities on Energy Transfer and Ellomay Capital 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 Energy Transfer with a short position of Ellomay Capital. Check out your portfolio center. Please also check ongoing floating volatility patterns of Energy Transfer and Ellomay Capital.
Diversification Opportunities for Energy Transfer and Ellomay Capital
0.86 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between Energy and Ellomay is 0.86. Overlapping area represents the amount of risk that can be diversified away by holding Energy Transfer LP and Ellomay Capital in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Ellomay Capital and Energy Transfer 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 Energy Transfer LP are associated (or correlated) with Ellomay Capital. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Ellomay Capital has no effect on the direction of Energy Transfer i.e., Energy Transfer and Ellomay Capital go up and down completely randomly.
Pair Corralation between Energy Transfer and Ellomay Capital
Allowing for the 90-day total investment horizon Energy Transfer LP is expected to generate 0.32 times more return on investment than Ellomay Capital. However, Energy Transfer LP is 3.15 times less risky than Ellomay Capital. It trades about 0.14 of its potential returns per unit of risk. Ellomay Capital is currently generating about 0.03 per unit of risk. If you would invest 981.00 in Energy Transfer LP on September 2, 2024 and sell it today you would earn a total of 1,005 from holding Energy Transfer LP or generate 102.45% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Strong |
| Accuracy | 96.98% |
| Values | Daily Returns |
Energy Transfer LP vs. Ellomay Capital
Performance |
| Timeline |
| Energy Transfer LP |
| Ellomay Capital |
Energy Transfer and Ellomay Capital Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Energy Transfer and Ellomay Capital
The main advantage of trading using opposite Energy Transfer and Ellomay Capital positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Energy Transfer position performs unexpectedly, Ellomay Capital 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 Ellomay Capital will offset losses from the drop in Ellomay Capital's long position.| Energy Transfer vs. Kinder Morgan | Energy Transfer vs. MPLX LP | Energy Transfer vs. Enbridge | Energy Transfer vs. Enterprise Products Partners |
| Ellomay Capital vs. Enlight Renewable Energy | Ellomay Capital vs. Renew Energy Global | Ellomay Capital vs. Clearway Energy Class | Ellomay Capital vs. Excelerate Energy |
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 Share Portfolio module to track or share privately all of your investments from the convenience of any device.
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