Correlation Between AST Groupe and Ekinops SA

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

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

Diversification Opportunities for AST Groupe and Ekinops SA

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Correlation Coefficient

AST Groupe  Ekinops SA

Pay attention - limited upside

The 3 months correlation between AST and Ekinops is 0.0. Overlapping area represents the amount of risk that can be diversified away by holding AST Groupe and Ekinops SA in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Ekinops SA and AST Groupe 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 AST Groupe are associated (or correlated) with Ekinops SA. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Ekinops SA has no effect on the direction of AST Groupe i.e., AST Groupe and Ekinops SA go up and down completely randomly.

Pair Corralation between AST Groupe and Ekinops SA

Assuming the 90 days trading horizon AST Groupe is expected to under-perform the Ekinops SA. In addition to that, AST Groupe is 2.01 times more volatile than Ekinops SA. It trades about -0.04 of its total potential returns per unit of risk. Ekinops SA is currently generating about -0.05 per unit of volatility. If you would invest  878.00  in Ekinops SA on October 12, 2024 and sell it today you would lose (527.00) from holding Ekinops SA or give up 60.02% of portfolio value over 90 days.

Time Period	3 Months [change]
Direction	Flat
Strength	Insignificant
Accuracy	99.8%
Values	Daily Returns

AST Groupe  vs.  Ekinops SA

AST Groupe

Risk-Adjusted Performance

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Very Weak

Over the last 90 days AST Groupe has generated negative risk-adjusted returns adding no value to investors with long positions. Even with relatively invariable basic indicators, AST Groupe is not utilizing all of its potentials. The latest stock price agitation, may contribute to short-term losses for the retail investors.

Ekinops SA

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Ekinops SA has generated negative risk-adjusted returns adding no value to investors with long positions. Despite latest weak performance, the Stock's forward indicators remain strong and the current disturbance on Wall Street may also be a sign of long term gains for the company investors.

Pair Trading with AST Groupe and Ekinops SA

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

The idea behind AST Groupe and Ekinops SA 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 Portfolio Diagnostics module to use generated alerts and portfolio events aggregator to diagnose current holdings.