Correlation Between AIRA Factoring and Ekarat Engineering

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

By analyzing existing cross correlation between AIRA Factoring Public and Ekarat Engineering Public, you can compare the effects of market volatilities on AIRA Factoring and Ekarat Engineering 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 AIRA Factoring with a short position of Ekarat Engineering. Check out your portfolio center. Please also check ongoing floating volatility patterns of AIRA Factoring and Ekarat Engineering.

Diversification Opportunities for AIRA Factoring and Ekarat Engineering

0.08

Correlation Coefficient

AIRA Factoring  Ekarat Engineering

Significant diversification

The 3 months correlation between AIRA and Ekarat is 0.08. Overlapping area represents the amount of risk that can be diversified away by holding AIRA Factoring Public and Ekarat Engineering Public in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Ekarat Engineering Public and AIRA Factoring 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 AIRA Factoring Public are associated (or correlated) with Ekarat Engineering. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Ekarat Engineering Public has no effect on the direction of AIRA Factoring i.e., AIRA Factoring and Ekarat Engineering go up and down completely randomly.

Pair Corralation between AIRA Factoring and Ekarat Engineering

Assuming the 90 days horizon AIRA Factoring Public is expected to under-perform the Ekarat Engineering. In addition to that, AIRA Factoring is 3.0 times more volatile than Ekarat Engineering Public. It trades about -0.04 of its total potential returns per unit of risk. Ekarat Engineering Public is currently generating about 0.09 per unit of volatility. If you would invest  95.00  in Ekarat Engineering Public on December 1, 2024 and sell it today you would earn a total of  7.00  from holding Ekarat Engineering Public or generate 7.37% return on investment over 90 days.

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

AIRA Factoring Public  vs.  Ekarat Engineering Public

AIRA Factoring Public

Risk-Adjusted Performance

Very Weak

Over the last 90 days AIRA Factoring Public has generated negative risk-adjusted returns adding no value to investors with long positions. Despite latest conflicting performance, the Stock's fundamental drivers remain persistent and the latest mess on Wall Street may also be a sign of long-standing gains for the company institutional investors.

Ekarat Engineering Public

Risk-Adjusted Performance

OK

Compared to the overall equity markets, risk-adjusted returns on investments in Ekarat Engineering Public are ranked lower than 7 (%) of all global equities and portfolios over the last 90 days. Despite quite conflicting basic indicators, Ekarat Engineering may actually be approaching a critical reversion point that can send shares even higher in April 2025.

Pair Trading with AIRA Factoring and Ekarat Engineering

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

The idea behind AIRA Factoring Public and Ekarat Engineering Public 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 My Watchlist Analysis module to analyze my current watchlist and to refresh optimization strategy. Macroaxis watchlist is based on self-learning algorithm to remember stocks you like.