Correlation Between ETF Managers and Okeanis Eco

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

By analyzing existing cross correlation between ETF Managers Group and Okeanis Eco Tankers, you can compare the effects of market volatilities on ETF Managers and Okeanis Eco 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 ETF Managers with a short position of Okeanis Eco. Check out your portfolio center. Please also check ongoing floating volatility patterns of ETF Managers and Okeanis Eco.

Diversification Opportunities for ETF Managers and Okeanis Eco

0.58

Correlation Coefficient

ETF Managers  Okeanis Eco

Very weak diversification

The 3 months correlation between ETF and Okeanis is 0.58. Overlapping area represents the amount of risk that can be diversified away by holding ETF Managers Group and Okeanis Eco Tankers in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Okeanis Eco Tankers and ETF Managers 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 ETF Managers Group are associated (or correlated) with Okeanis Eco. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Okeanis Eco Tankers has no effect on the direction of ETF Managers i.e., ETF Managers and Okeanis Eco go up and down completely randomly.

Pair Corralation between ETF Managers and Okeanis Eco

Given the investment horizon of 90 days ETF Managers Group is expected to generate 1.49 times more return on investment than Okeanis Eco. However, ETF Managers is 1.49 times more volatile than Okeanis Eco Tankers. It trades about 0.06 of its potential returns per unit of risk. Okeanis Eco Tankers is currently generating about 0.03 per unit of risk. If you would invest  991.00  in ETF Managers Group on December 28, 2024 and sell it today you would earn a total of  107.50  from holding ETF Managers Group or generate 10.85% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Together
Strength	Weak
Accuracy	96.83%
Values	Daily Returns

ETF Managers Group  vs.  Okeanis Eco Tankers

ETF Managers Group

Risk-Adjusted Performance

Insignificant

Compared to the overall equity markets, risk-adjusted returns on investments in ETF Managers Group are ranked lower than 4 (%) of all global equities and portfolios over the last 90 days. In spite of comparatively conflicting technical and fundamental indicators, ETF Managers unveiled solid returns over the last few months and may actually be approaching a breakup point.

Okeanis Eco Tankers

Risk-Adjusted Performance

Weak

Compared to the overall equity markets, risk-adjusted returns on investments in Okeanis Eco Tankers are ranked lower than 2 (%) of all global equities and portfolios over the last 90 days. Despite quite persistent basic indicators, Okeanis Eco is not utilizing all of its potentials. The recent stock price mess, may contribute to short-term losses for the institutional investors.

Pair Trading with ETF Managers and Okeanis Eco

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

The idea behind ETF Managers Group and Okeanis Eco Tankers 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 Dashboard module to portfolio dashboard that provides centralized access to all your investments.