Correlation Between Echiquier Major and Intel

Can any of the company-specific risk be diversified away by investing in both Echiquier Major and Intel 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 Echiquier Major and Intel into the same portfolio, which is an essential part of the fundamental portfolio management process.

By analyzing existing cross correlation between Echiquier Major SRI and Intel, you can compare the effects of market volatilities on Echiquier Major and Intel 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 Echiquier Major with a short position of Intel. Check out your portfolio center. Please also check ongoing floating volatility patterns of Echiquier Major and Intel.

Diversification Opportunities for Echiquier Major and Intel

-0.72

Correlation Coefficient

Echiquier Major  Intel

Pay attention - limited upside

The 3 months correlation between Echiquier and Intel is -0.72. Overlapping area represents the amount of risk that can be diversified away by holding Echiquier Major SRI and Intel in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Intel and Echiquier Major 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 Echiquier Major SRI are associated (or correlated) with Intel. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Intel has no effect on the direction of Echiquier Major i.e., Echiquier Major and Intel go up and down completely randomly.

Pair Corralation between Echiquier Major and Intel

Assuming the 90 days trading horizon Echiquier Major SRI is expected to generate 0.22 times more return on investment than Intel. However, Echiquier Major SRI is 4.48 times less risky than Intel. It trades about 0.2 of its potential returns per unit of risk. Intel is currently generating about -0.28 per unit of risk. If you would invest  40,352  in Echiquier Major SRI on September 22, 2024 and sell it today you would earn a total of  1,322  from holding Echiquier Major SRI or generate 3.28% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Against
Strength	Weak
Accuracy	100.0%
Values	Daily Returns

Echiquier Major SRI  vs.  Intel

Echiquier Major SRI

Risk-Adjusted Performance

5 of 100

Modest

Compared to the overall equity markets, risk-adjusted returns on investments in Echiquier Major SRI are ranked lower than 5 (%) of all funds and portfolios of funds over the last 90 days. In spite of very healthy basic indicators, Echiquier Major is not utilizing all of its potentials. The current stock price disarray, may contribute to short-term losses for the investors.

Intel

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Intel has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of latest uncertain performance, the Stock's essential indicators remain stable and the newest uproar on Wall Street may also be a sign of mid-term gains for the firm private investors.

Pair Trading with Echiquier Major and Intel

The main advantage of trading using opposite Echiquier Major and Intel positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Echiquier Major position performs unexpectedly, Intel 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 Intel will offset losses from the drop in Intel's long position.

The idea behind Echiquier Major SRI and Intel 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.

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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 Investing Opportunities module to build portfolios using our predefined set of ideas and optimize them against your investing preferences.