Correlation Between Eguana Technologies and Current Water

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

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

Diversification Opportunities for Eguana Technologies and Current Water

0.0

Correlation Coefficient

Eguana Technologies  Current Water

Pay attention - limited upside

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

Pair Corralation between Eguana Technologies and Current Water

Assuming the 90 days horizon Eguana Technologies is expected to generate 1.41 times more return on investment than Current Water. However, Eguana Technologies is 1.41 times more volatile than Current Water Technologies. It trades about 0.06 of its potential returns per unit of risk. Current Water Technologies is currently generating about 0.04 per unit of risk. If you would invest  3.00  in Eguana Technologies on September 4, 2024 and sell it today you would lose (2.00) from holding Eguana Technologies or give up 66.67% of portfolio value over 90 days.

Time Period	3 Months [change]
Direction	Flat
Strength	Insignificant
Accuracy	99.6%
Values	Daily Returns

Eguana Technologies  vs.  Current Water Technologies

Eguana Technologies

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Eguana Technologies has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of fairly stable basic indicators, Eguana Technologies is not utilizing all of its potentials. The latest stock price fuss, may contribute to near-short-term losses for the sophisticated investors.

Current Water Techno

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Current Water Technologies has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of latest abnormal performance, the Stock's basic indicators remain stable and the latest fuss on Wall Street may also be a sign of long-term gains for the venture sophisticated investors.

Pair Trading with Eguana Technologies and Current Water

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

The idea behind Eguana Technologies and Current Water Technologies 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 Companies Directory module to evaluate performance of over 100,000 Stocks, Funds, and ETFs against different fundamentals.