Correlation Between Xintela AB and Ellen AB
Can any of the company-specific risk be diversified away by investing in both Xintela AB and Ellen AB 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 Xintela AB and Ellen AB into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Xintela AB and Ellen AB, you can compare the effects of market volatilities on Xintela AB and Ellen AB 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 Xintela AB with a short position of Ellen AB. Check out your portfolio center. Please also check ongoing floating volatility patterns of Xintela AB and Ellen AB.
Diversification Opportunities for Xintela AB and Ellen AB
-0.52 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between Xintela and Ellen is -0.52. Overlapping area represents the amount of risk that can be diversified away by holding Xintela AB and Ellen AB in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Ellen AB and Xintela AB 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 Xintela AB are associated (or correlated) with Ellen AB. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Ellen AB has no effect on the direction of Xintela AB i.e., Xintela AB and Ellen AB go up and down completely randomly.
Pair Corralation between Xintela AB and Ellen AB
Assuming the 90 days trading horizon Xintela AB is expected to generate 2.37 times more return on investment than Ellen AB. However, Xintela AB is 2.37 times more volatile than Ellen AB. It trades about 0.05 of its potential returns per unit of risk. Ellen AB is currently generating about -0.07 per unit of risk. If you would invest 27.00 in Xintela AB on August 29, 2024 and sell it today you would earn a total of 5.00 from holding Xintela AB or generate 18.52% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Xintela AB vs. Ellen AB
Performance |
| Timeline |
| Xintela AB |
| Ellen AB |
Xintela AB and Ellen AB Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Xintela AB and Ellen AB
The main advantage of trading using opposite Xintela AB and Ellen AB positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Xintela AB position performs unexpectedly, Ellen AB 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 Ellen AB will offset losses from the drop in Ellen AB's long position.The idea behind Xintela AB and Ellen AB pairs trading is to make the combined position market-neutral, meaning the overall market's direction will not affect its win or loss (or potential downside or upside). This can be achieved by designing a pairs trade with two highly correlated stocks or equities that operate in a similar space or sector, making it possible to obtain profits through simple and relatively low-risk investment.| Ellen AB vs. Mendus AB | Ellen AB vs. JonDeTech Sensors | Ellen AB vs. Nexam Chemical Holding | Ellen AB vs. Lohilo Foods AB |
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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