Correlation Between Service Team and ECARX Holdings
Can any of the company-specific risk be diversified away by investing in both Service Team and ECARX Holdings 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 Service Team and ECARX Holdings into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Service Team and ECARX Holdings Warrants, you can compare the effects of market volatilities on Service Team and ECARX Holdings 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 Service Team with a short position of ECARX Holdings. Check out your portfolio center. Please also check ongoing floating volatility patterns of Service Team and ECARX Holdings.
Diversification Opportunities for Service Team and ECARX Holdings
0.0 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between Service and ECARX is 0.0. Overlapping area represents the amount of risk that can be diversified away by holding Service Team and ECARX Holdings Warrants in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on ECARX Holdings Warrants and Service Team 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 Service Team are associated (or correlated) with ECARX Holdings. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of ECARX Holdings Warrants has no effect on the direction of Service Team i.e., Service Team and ECARX Holdings go up and down completely randomly.
Pair Corralation between Service Team and ECARX Holdings
Given the investment horizon of 90 days Service Team is expected to generate 5.0 times less return on investment than ECARX Holdings. But when comparing it to its historical volatility, Service Team is 2.14 times less risky than ECARX Holdings. It trades about 0.04 of its potential returns per unit of risk. ECARX Holdings Warrants is currently generating about 0.09 of returns per unit of risk over similar time horizon. If you would invest 7.26 in ECARX Holdings Warrants on September 12, 2024 and sell it today you would lose (4.60) from holding ECARX Holdings Warrants or give up 63.36% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Flat |
| Strength | Insignificant |
| Accuracy | 66.6% |
| Values | Daily Returns |
Service Team vs. ECARX Holdings Warrants
Performance |
| Timeline |
| Service Team |
| ECARX Holdings Warrants |
Service Team and ECARX Holdings Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Service Team and ECARX Holdings
The main advantage of trading using opposite Service Team and ECARX Holdings positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Service Team position performs unexpectedly, ECARX Holdings 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 ECARX Holdings will offset losses from the drop in ECARX Holdings' long position.| Service Team vs. American Axle Manufacturing | Service Team vs. Modine Manufacturing | Service Team vs. Aeye Inc | Service Team vs. Marketing Worldwide |
| ECARX Holdings vs. Dorman Products | ECARX Holdings vs. Monro Muffler Brake | ECARX Holdings vs. Standard Motor Products | ECARX Holdings vs. Stoneridge |
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 Portfolio Manager module to state of the art Portfolio Manager to monitor and improve performance of your invested capital.
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