Correlation Between SLR Investment and EVS Broadcast
Can any of the company-specific risk be diversified away by investing in both SLR Investment and EVS Broadcast 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 SLR Investment and EVS Broadcast into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between SLR Investment Corp and EVS Broadcast Equipment, you can compare the effects of market volatilities on SLR Investment and EVS Broadcast 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 SLR Investment with a short position of EVS Broadcast. Check out your portfolio center. Please also check ongoing floating volatility patterns of SLR Investment and EVS Broadcast.
Diversification Opportunities for SLR Investment and EVS Broadcast
0.33 | Correlation Coefficient |
Weak diversification
The 3 months correlation between SLR and EVS is 0.33. Overlapping area represents the amount of risk that can be diversified away by holding SLR Investment Corp and EVS Broadcast Equipment in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on EVS Broadcast Equipment and SLR Investment 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 SLR Investment Corp are associated (or correlated) with EVS Broadcast. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of EVS Broadcast Equipment has no effect on the direction of SLR Investment i.e., SLR Investment and EVS Broadcast go up and down completely randomly.
Pair Corralation between SLR Investment and EVS Broadcast
Assuming the 90 days horizon SLR Investment is expected to generate 1.83 times less return on investment than EVS Broadcast. But when comparing it to its historical volatility, SLR Investment Corp is 1.01 times less risky than EVS Broadcast. It trades about 0.19 of its potential returns per unit of risk. EVS Broadcast Equipment is currently generating about 0.34 of returns per unit of risk over similar time horizon. If you would invest 2,731 in EVS Broadcast Equipment on September 13, 2024 and sell it today you would earn a total of 309.00 from holding EVS Broadcast Equipment or generate 11.31% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 95.65% |
| Values | Daily Returns |
SLR Investment Corp vs. EVS Broadcast Equipment
Performance |
| Timeline |
| SLR Investment Corp |
| EVS Broadcast Equipment |
SLR Investment and EVS Broadcast Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with SLR Investment and EVS Broadcast
The main advantage of trading using opposite SLR Investment and EVS Broadcast positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if SLR Investment position performs unexpectedly, EVS Broadcast 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 EVS Broadcast will offset losses from the drop in EVS Broadcast's long position.| SLR Investment vs. EVS Broadcast Equipment | SLR Investment vs. Summit Hotel Properties | SLR Investment vs. Park Hotels Resorts | SLR Investment vs. BROADSTNET LEADL 00025 |
| EVS Broadcast vs. FIREWEED METALS P | EVS Broadcast vs. UPDATE SOFTWARE | EVS Broadcast vs. Magic Software Enterprises | EVS Broadcast vs. Check Point Software |
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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