Correlation Between Ecovyst and G III

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

By analyzing existing cross correlation between Ecovyst and G III Apparel Group, you can compare the effects of market volatilities on Ecovyst and G III 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 Ecovyst with a short position of G III. Check out your portfolio center. Please also check ongoing floating volatility patterns of Ecovyst and G III.

Diversification Opportunities for Ecovyst and G III

0.44

Correlation Coefficient

Ecovyst  G III

Very weak diversification

The 3 months correlation between Ecovyst and GIII is 0.44. Overlapping area represents the amount of risk that can be diversified away by holding Ecovyst and G III Apparel Group in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on G III Apparel and Ecovyst 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 Ecovyst are associated (or correlated) with G III. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of G III Apparel has no effect on the direction of Ecovyst i.e., Ecovyst and G III go up and down completely randomly.

Pair Corralation between Ecovyst and G III

Given the investment horizon of 90 days Ecovyst is expected to generate 1.25 times more return on investment than G III. However, Ecovyst is 1.25 times more volatile than G III Apparel Group. It trades about -0.04 of its potential returns per unit of risk. G III Apparel Group is currently generating about -0.16 per unit of risk. If you would invest  752.00  in Ecovyst on December 20, 2024 and sell it today you would lose (59.00) from holding Ecovyst or give up 7.85% of portfolio value over 90 days.

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

Ecovyst  vs.  G III Apparel Group

Ecovyst

Risk-Adjusted Performance

Very Weak

Over the last 90 days Ecovyst has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of latest unsteady performance, the Stock's basic indicators remain stable and the newest uproar on Wall Street may also be a sign of mid-term gains for the firm private investors.

G III Apparel

Risk-Adjusted Performance

Very Weak

Over the last 90 days G III Apparel Group has generated negative risk-adjusted returns adding no value to investors with long positions. Despite unfluctuating performance in the last few months, the Stock's forward indicators remain fairly strong which may send shares a bit higher in April 2025. The recent confusion may also be a sign of long-lasting up-swing for the firm traders.

Pair Trading with Ecovyst and G III

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

The idea behind Ecovyst and G III Apparel Group 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 Money Managers module to screen money managers from public funds and ETFs managed around the world.