Correlation Between Exco Technologies and DelphX Capital
Can any of the company-specific risk be diversified away by investing in both Exco Technologies and DelphX Capital 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 Exco Technologies and DelphX Capital into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Exco Technologies Limited and DelphX Capital Markets, you can compare the effects of market volatilities on Exco Technologies and DelphX Capital 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 Exco Technologies with a short position of DelphX Capital. Check out your portfolio center. Please also check ongoing floating volatility patterns of Exco Technologies and DelphX Capital.
Diversification Opportunities for Exco Technologies and DelphX Capital
-0.52 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between Exco and DelphX is -0.52. Overlapping area represents the amount of risk that can be diversified away by holding Exco Technologies Limited and DelphX Capital Markets in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on DelphX Capital Markets and Exco Technologies 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 Exco Technologies Limited are associated (or correlated) with DelphX Capital. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of DelphX Capital Markets has no effect on the direction of Exco Technologies i.e., Exco Technologies and DelphX Capital go up and down completely randomly.
Pair Corralation between Exco Technologies and DelphX Capital
Assuming the 90 days trading horizon Exco Technologies is expected to generate 6.97 times less return on investment than DelphX Capital. But when comparing it to its historical volatility, Exco Technologies Limited is 4.9 times less risky than DelphX Capital. It trades about 0.03 of its potential returns per unit of risk. DelphX Capital Markets is currently generating about 0.05 of returns per unit of risk over similar time horizon. If you would invest 10.00 in DelphX Capital Markets on August 24, 2024 and sell it today you would earn a total of 1.00 from holding DelphX Capital Markets or generate 10.0% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Exco Technologies Limited vs. DelphX Capital Markets
Performance |
| Timeline |
| Exco Technologies |
| DelphX Capital Markets |
Exco Technologies and DelphX Capital Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Exco Technologies and DelphX Capital
The main advantage of trading using opposite Exco Technologies and DelphX Capital positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Exco Technologies position performs unexpectedly, DelphX Capital 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 DelphX Capital will offset losses from the drop in DelphX Capital's long position.| Exco Technologies vs. Transcontinental | Exco Technologies vs. Methanex | Exco Technologies vs. Stella Jones | Exco Technologies vs. High Liner Foods |
| DelphX Capital vs. Sparx Technology | DelphX Capital vs. Firan Technology Group | DelphX Capital vs. High Liner Foods | DelphX Capital vs. Exco Technologies Limited |
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 FinTech Suite module to use AI to screen and filter profitable investment opportunities.
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