Correlation Between Stag Industrial and Easy Software
Can any of the company-specific risk be diversified away by investing in both Stag Industrial and Easy Software 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 Stag Industrial and Easy Software into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Stag Industrial and Easy Software AG, you can compare the effects of market volatilities on Stag Industrial and Easy Software 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 Stag Industrial with a short position of Easy Software. Check out your portfolio center. Please also check ongoing floating volatility patterns of Stag Industrial and Easy Software.
Diversification Opportunities for Stag Industrial and Easy Software
-0.4 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Stag and Easy is -0.4. Overlapping area represents the amount of risk that can be diversified away by holding Stag Industrial and Easy Software AG in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Easy Software AG and Stag Industrial 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 Stag Industrial are associated (or correlated) with Easy Software. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Easy Software AG has no effect on the direction of Stag Industrial i.e., Stag Industrial and Easy Software go up and down completely randomly.
Pair Corralation between Stag Industrial and Easy Software
Assuming the 90 days trading horizon Stag Industrial is expected to under-perform the Easy Software. But the stock apears to be less risky and, when comparing its historical volatility, Stag Industrial is 2.56 times less risky than Easy Software. The stock trades about 0.0 of its potential returns per unit of risk. The Easy Software AG is currently generating about 0.1 of returns per unit of risk over similar time horizon. If you would invest 1,460 in Easy Software AG on December 12, 2024 and sell it today you would earn a total of 320.00 from holding Easy Software AG or generate 21.92% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Stag Industrial vs. Easy Software AG
Performance |
| Timeline |
| Stag Industrial |
| Easy Software AG |
Stag Industrial and Easy Software Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Stag Industrial and Easy Software
The main advantage of trading using opposite Stag Industrial and Easy Software positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Stag Industrial position performs unexpectedly, Easy Software 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 Easy Software will offset losses from the drop in Easy Software's long position.| Stag Industrial vs. COPLAND ROAD CAPITAL | ||
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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 Equity Forecasting module to use basic forecasting models to generate price predictions and determine price momentum.
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