Correlation Between Skechers USA and Electrovaya Common
Can any of the company-specific risk be diversified away by investing in both Skechers USA and Electrovaya Common 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 Skechers USA and Electrovaya Common into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Skechers USA and Electrovaya Common Shares, you can compare the effects of market volatilities on Skechers USA and Electrovaya Common 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 Skechers USA with a short position of Electrovaya Common. Check out your portfolio center. Please also check ongoing floating volatility patterns of Skechers USA and Electrovaya Common.
Diversification Opportunities for Skechers USA and Electrovaya Common
-0.21 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Skechers and Electrovaya is -0.21. Overlapping area represents the amount of risk that can be diversified away by holding Skechers USA and Electrovaya Common Shares in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Electrovaya Common Shares and Skechers USA 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 Skechers USA are associated (or correlated) with Electrovaya Common. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Electrovaya Common Shares has no effect on the direction of Skechers USA i.e., Skechers USA and Electrovaya Common go up and down completely randomly.
Pair Corralation between Skechers USA and Electrovaya Common
Considering the 90-day investment horizon Skechers USA is expected to generate 0.54 times more return on investment than Electrovaya Common. However, Skechers USA is 1.84 times less risky than Electrovaya Common. It trades about 0.05 of its potential returns per unit of risk. Electrovaya Common Shares is currently generating about -0.02 per unit of risk. If you would invest 4,175 in Skechers USA on August 26, 2024 and sell it today you would earn a total of 1,994 from holding Skechers USA or generate 47.76% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Skechers USA vs. Electrovaya Common Shares
Performance |
| Timeline |
| Skechers USA |
| Electrovaya Common Shares |
Skechers USA and Electrovaya Common Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Skechers USA and Electrovaya Common
The main advantage of trading using opposite Skechers USA and Electrovaya Common positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Skechers USA position performs unexpectedly, Electrovaya Common 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 Electrovaya Common will offset losses from the drop in Electrovaya Common's long position.| Skechers USA vs. On Holding | Skechers USA vs. Steven Madden | Skechers USA vs. Crocs Inc | Skechers USA vs. Designer Brands |
| Electrovaya Common vs. Bloom Energy Corp | Electrovaya Common vs. Eos Energy Enterprises | Electrovaya Common vs. Sunrise New Energy | Electrovaya Common vs. Flux Power Holdings |
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 AI Portfolio Architect module to use AI to generate optimal portfolios and find profitable investment opportunities.
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