Correlation Between INFORMATION SVC and Eli Lilly
Can any of the company-specific risk be diversified away by investing in both INFORMATION SVC and Eli Lilly 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 INFORMATION SVC and Eli Lilly into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between INFORMATION SVC GRP and Eli Lilly and, you can compare the effects of market volatilities on INFORMATION SVC and Eli Lilly 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 INFORMATION SVC with a short position of Eli Lilly. Check out your portfolio center. Please also check ongoing floating volatility patterns of INFORMATION SVC and Eli Lilly.
Diversification Opportunities for INFORMATION SVC and Eli Lilly
-0.48 | Correlation Coefficient |
Very good diversification
The 3 months correlation between INFORMATION and Eli is -0.48. Overlapping area represents the amount of risk that can be diversified away by holding INFORMATION SVC GRP and Eli Lilly and in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Eli Lilly and INFORMATION SVC 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 INFORMATION SVC GRP are associated (or correlated) with Eli Lilly. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Eli Lilly has no effect on the direction of INFORMATION SVC i.e., INFORMATION SVC and Eli Lilly go up and down completely randomly.
Pair Corralation between INFORMATION SVC and Eli Lilly
Assuming the 90 days horizon INFORMATION SVC GRP is expected to generate 0.78 times more return on investment than Eli Lilly. However, INFORMATION SVC GRP is 1.28 times less risky than Eli Lilly. It trades about 0.33 of its potential returns per unit of risk. Eli Lilly and is currently generating about -0.01 per unit of risk. If you would invest 310.00 in INFORMATION SVC GRP on September 15, 2024 and sell it today you would earn a total of 46.00 from holding INFORMATION SVC GRP or generate 14.84% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 95.65% |
| Values | Daily Returns |
INFORMATION SVC GRP vs. Eli Lilly and
Performance |
| Timeline |
| INFORMATION SVC GRP |
| Eli Lilly |
INFORMATION SVC and Eli Lilly Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with INFORMATION SVC and Eli Lilly
The main advantage of trading using opposite INFORMATION SVC and Eli Lilly positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if INFORMATION SVC position performs unexpectedly, Eli Lilly 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 Eli Lilly will offset losses from the drop in Eli Lilly's long position.| INFORMATION SVC vs. Apple Inc | INFORMATION SVC vs. Apple Inc | INFORMATION SVC vs. Apple Inc | INFORMATION SVC vs. Apple Inc |
| Eli Lilly vs. Charter Communications | Eli Lilly vs. Shenandoah Telecommunications | Eli Lilly vs. Hyrican Informationssysteme Aktiengesellschaft | Eli Lilly vs. INFORMATION SVC GRP |
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 Price Exposure Probability module to analyze equity upside and downside potential for a given time horizon across multiple markets.
Other Complementary Tools
| Aroon Oscillator Analyze current equity momentum using Aroon Oscillator and other momentum ratios | |
| Equity Valuation Check real value of public entities based on technical and fundamental data | |
| Commodity Channel Use Commodity Channel Index to analyze current equity momentum | |
| ETF Categories List of ETF categories grouped based on various criteria, such as the investment strategy or type of investments | |
| Latest Portfolios Quick portfolio dashboard that showcases your latest portfolios |