Correlation Between Algebris UCITS and Esfera Robotics

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

By analyzing existing cross correlation between Algebris UCITS Funds and Esfera Robotics R, you can compare the effects of market volatilities on Algebris UCITS and Esfera Robotics 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 Algebris UCITS with a short position of Esfera Robotics. Check out your portfolio center. Please also check ongoing floating volatility patterns of Algebris UCITS and Esfera Robotics.

Diversification Opportunities for Algebris UCITS and Esfera Robotics

0.01

Correlation Coefficient

Algebris UCITS  Esfera Robotics

Significant diversification

The 3 months correlation between Algebris and Esfera is 0.01. Overlapping area represents the amount of risk that can be diversified away by holding Algebris UCITS Funds and Esfera Robotics R in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Esfera Robotics R and Algebris UCITS 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 Algebris UCITS Funds are associated (or correlated) with Esfera Robotics. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Esfera Robotics R has no effect on the direction of Algebris UCITS i.e., Algebris UCITS and Esfera Robotics go up and down completely randomly.

Pair Corralation between Algebris UCITS and Esfera Robotics

Assuming the 90 days trading horizon Algebris UCITS is expected to generate 3.14 times less return on investment than Esfera Robotics. But when comparing it to its historical volatility, Algebris UCITS Funds is 3.7 times less risky than Esfera Robotics. It trades about 0.12 of its potential returns per unit of risk. Esfera Robotics R is currently generating about 0.1 of returns per unit of risk over similar time horizon. If you would invest  20,090  in Esfera Robotics R on September 22, 2024 and sell it today you would earn a total of  14,758  from holding Esfera Robotics R or generate 73.46% return on investment over 90 days.

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

Algebris UCITS Funds  vs.  Esfera Robotics R

Algebris UCITS Funds

Risk-Adjusted Performance

7 of 100

OK

Compared to the overall equity markets, risk-adjusted returns on investments in Algebris UCITS Funds are ranked lower than 7 (%) of all funds and portfolios of funds over the last 90 days. Despite somewhat strong basic indicators, Algebris UCITS is not utilizing all of its potentials. The current stock price disturbance, may contribute to short-term losses for the investors.

Esfera Robotics R

Risk-Adjusted Performance

14 of 100

Good

Compared to the overall equity markets, risk-adjusted returns on investments in Esfera Robotics R are ranked lower than 14 (%) of all funds and portfolios of funds over the last 90 days. Despite somewhat fragile basic indicators, Esfera Robotics sustained solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with Algebris UCITS and Esfera Robotics

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

The idea behind Algebris UCITS Funds and Esfera Robotics R 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 Top Crypto Exchanges module to search and analyze digital assets across top global cryptocurrency exchanges.