Correlation Between Exmar NV and Iep Invest
Can any of the company-specific risk be diversified away by investing in both Exmar NV and Iep Invest 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 Exmar NV and Iep Invest into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Exmar NV and Iep Invest, you can compare the effects of market volatilities on Exmar NV and Iep Invest 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 Exmar NV with a short position of Iep Invest. Check out your portfolio center. Please also check ongoing floating volatility patterns of Exmar NV and Iep Invest.
Diversification Opportunities for Exmar NV and Iep Invest
0.12 | Correlation Coefficient |
Average diversification
The 3 months correlation between Exmar and Iep is 0.12. Overlapping area represents the amount of risk that can be diversified away by holding Exmar NV and Iep Invest in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Iep Invest and Exmar NV 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 Exmar NV are associated (or correlated) with Iep Invest. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Iep Invest has no effect on the direction of Exmar NV i.e., Exmar NV and Iep Invest go up and down completely randomly.
Pair Corralation between Exmar NV and Iep Invest
Assuming the 90 days trading horizon Exmar NV is expected to under-perform the Iep Invest. But the stock apears to be less risky and, when comparing its historical volatility, Exmar NV is 1.07 times less risky than Iep Invest. The stock trades about -0.03 of its potential returns per unit of risk. The Iep Invest is currently generating about 0.02 of returns per unit of risk over similar time horizon. If you would invest 520.00 in Iep Invest on August 25, 2024 and sell it today you would earn a total of 0.00 from holding Iep Invest or generate 0.0% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Exmar NV vs. Iep Invest
Performance |
| Timeline |
| Exmar NV |
| Iep Invest |
Exmar NV and Iep Invest Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Exmar NV and Iep Invest
The main advantage of trading using opposite Exmar NV and Iep Invest positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Exmar NV position performs unexpectedly, Iep Invest 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 Iep Invest will offset losses from the drop in Iep Invest's long position.| Exmar NV vs. EVS Broadcast Equipment | Exmar NV vs. NV Bekaert SA | Exmar NV vs. Tessenderlo | Exmar NV vs. Melexis NV |
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 Commodity Channel module to use Commodity Channel Index to analyze current equity momentum.
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