Correlation Between Eureka Design and Globlex Holding
Can any of the company-specific risk be diversified away by investing in both Eureka Design and Globlex Holding 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 Eureka Design and Globlex Holding into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Eureka Design Public and Globlex Holding Management, you can compare the effects of market volatilities on Eureka Design and Globlex Holding 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 Eureka Design with a short position of Globlex Holding. Check out your portfolio center. Please also check ongoing floating volatility patterns of Eureka Design and Globlex Holding.
Diversification Opportunities for Eureka Design and Globlex Holding
0.17 | Correlation Coefficient |
Average diversification
The 3 months correlation between Eureka and Globlex is 0.17. Overlapping area represents the amount of risk that can be diversified away by holding Eureka Design Public and Globlex Holding Management in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Globlex Holding Mana and Eureka Design 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 Eureka Design Public are associated (or correlated) with Globlex Holding. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Globlex Holding Mana has no effect on the direction of Eureka Design i.e., Eureka Design and Globlex Holding go up and down completely randomly.
Pair Corralation between Eureka Design and Globlex Holding
Assuming the 90 days trading horizon Eureka Design Public is expected to generate 1.59 times more return on investment than Globlex Holding. However, Eureka Design is 1.59 times more volatile than Globlex Holding Management. It trades about 0.39 of its potential returns per unit of risk. Globlex Holding Management is currently generating about -0.27 per unit of risk. If you would invest 51.00 in Eureka Design Public on September 4, 2024 and sell it today you would earn a total of 14.00 from holding Eureka Design Public or generate 27.45% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Eureka Design Public vs. Globlex Holding Management
Performance |
| Timeline |
| Eureka Design Public |
| Globlex Holding Mana |
Eureka Design and Globlex Holding Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Eureka Design and Globlex Holding
The main advantage of trading using opposite Eureka Design and Globlex Holding positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Eureka Design position performs unexpectedly, Globlex Holding 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 Globlex Holding will offset losses from the drop in Globlex Holding's long position.| Eureka Design vs. Delta Electronics Public | Eureka Design vs. Delta Electronics Public | Eureka Design vs. Airports of Thailand | Eureka Design vs. Airports of Thailand |
| Globlex Holding vs. Thai Steel Cable | Globlex Holding vs. Tropical Canning Public | Globlex Holding vs. RB Food Supply | Globlex Holding vs. Eureka Design Public |
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 Backtesting module to avoid under-diversification and over-optimization by backtesting your portfolios.
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