Correlation Between Alphanam and EVN Finance

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

By analyzing existing cross correlation between Alphanam ME and EVN Finance JSC, you can compare the effects of market volatilities on Alphanam and EVN Finance 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 Alphanam with a short position of EVN Finance. Check out your portfolio center. Please also check ongoing floating volatility patterns of Alphanam and EVN Finance.

Diversification Opportunities for Alphanam and EVN Finance

-0.17

Correlation Coefficient

Alphanam  EVN Finance

Good diversification

The 3 months correlation between Alphanam and EVN is -0.17. Overlapping area represents the amount of risk that can be diversified away by holding Alphanam ME and EVN Finance JSC in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on EVN Finance JSC and Alphanam 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 Alphanam ME are associated (or correlated) with EVN Finance. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of EVN Finance JSC has no effect on the direction of Alphanam i.e., Alphanam and EVN Finance go up and down completely randomly.

Pair Corralation between Alphanam and EVN Finance

Assuming the 90 days trading horizon Alphanam is expected to generate 1.53 times less return on investment than EVN Finance. In addition to that, Alphanam is 1.3 times more volatile than EVN Finance JSC. It trades about 0.02 of its total potential returns per unit of risk. EVN Finance JSC is currently generating about 0.03 per unit of volatility. If you would invest  989,000  in EVN Finance JSC on December 21, 2024 and sell it today you would earn a total of  26,000  from holding EVN Finance JSC or generate 2.63% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Against
Strength	Insignificant
Accuracy	47.46%
Values	Daily Returns

Alphanam ME  vs.  EVN Finance JSC

Alphanam ME

Risk-Adjusted Performance

Very Weak

Compared to the overall equity markets, risk-adjusted returns on investments in Alphanam ME are ranked lower than 1 (%) of all global equities and portfolios over the last 90 days. In spite of very healthy technical and fundamental indicators, Alphanam is not utilizing all of its potentials. The recent stock price disarray, may contribute to short-term losses for the investors.

EVN Finance JSC

Risk-Adjusted Performance

Weak

Compared to the overall equity markets, risk-adjusted returns on investments in EVN Finance JSC are ranked lower than 2 (%) of all global equities and portfolios over the last 90 days. In spite of very healthy technical and fundamental indicators, EVN Finance is not utilizing all of its potentials. The current stock price disarray, may contribute to short-term losses for the investors.

Pair Trading with Alphanam and EVN Finance

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

The idea behind Alphanam ME and EVN Finance JSC 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.

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 Headlines Timeline module to stay connected to all market stories and filter out noise. Drill down to analyze hype elasticity.