Correlation Between Proximus and Ekopak BV
Can any of the company-specific risk be diversified away by investing in both Proximus and Ekopak BV 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 Proximus and Ekopak BV into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Proximus NV and Ekopak BV, you can compare the effects of market volatilities on Proximus and Ekopak BV 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 Proximus with a short position of Ekopak BV. Check out your portfolio center. Please also check ongoing floating volatility patterns of Proximus and Ekopak BV.
Diversification Opportunities for Proximus and Ekopak BV
Poor diversification
The 3 months correlation between Proximus and Ekopak is 0.74. Overlapping area represents the amount of risk that can be diversified away by holding Proximus NV and Ekopak BV in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Ekopak BV and Proximus 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 Proximus NV are associated (or correlated) with Ekopak BV. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Ekopak BV has no effect on the direction of Proximus i.e., Proximus and Ekopak BV go up and down completely randomly.
Pair Corralation between Proximus and Ekopak BV
Assuming the 90 days trading horizon Proximus NV is expected to generate 0.92 times more return on investment than Ekopak BV. However, Proximus NV is 1.08 times less risky than Ekopak BV. It trades about -0.02 of its potential returns per unit of risk. Ekopak BV is currently generating about -0.02 per unit of risk. If you would invest 666.00 in Proximus NV on November 9, 2024 and sell it today you would lose (150.00) from holding Proximus NV or give up 22.52% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Proximus NV vs. Ekopak BV
Performance |
| Timeline |
| Proximus NV |
| Ekopak BV |
Proximus and Ekopak BV Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Proximus and Ekopak BV
The main advantage of trading using opposite Proximus and Ekopak BV positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Proximus position performs unexpectedly, Ekopak BV 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 Ekopak BV will offset losses from the drop in Ekopak BV's long position.| Proximus vs. Bpost NV | Proximus vs. Etablissementen Franz Colruyt | Proximus vs. ageas SANV | Proximus vs. KBC Groep NV |
| Ekopak BV vs. Xior Student Housing | Ekopak BV vs. DIeteren Group SA | Ekopak BV vs. Melexis NV | Ekopak BV vs. DEME Group 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 Financial Widgets module to easily integrated Macroaxis content with over 30 different plug-and-play financial widgets.
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