Correlation Between E L and Green Panda

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

By analyzing existing cross correlation between E L Financial Corp and Green Panda Capital, you can compare the effects of market volatilities on E L and Green Panda 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 E L with a short position of Green Panda. Check out your portfolio center. Please also check ongoing floating volatility patterns of E L and Green Panda.

Diversification Opportunities for E L and Green Panda

0.0

Correlation Coefficient

E L  Green Panda

Pay attention - limited upside

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

Pair Corralation between E L and Green Panda

If you would invest  130,131  in E L Financial Corp on September 14, 2024 and sell it today you would earn a total of  9,868  from holding E L Financial Corp or generate 7.58% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Flat
Strength	Insignificant
Accuracy	100.0%
Values	Daily Returns

E L Financial Corp  vs.  Green Panda Capital

E L Financial

Risk-Adjusted Performance

6 of 100

OK

Compared to the overall equity markets, risk-adjusted returns on investments in E L Financial Corp are ranked lower than 6 (%) of all global equities and portfolios over the last 90 days. In spite of very unfluctuating technical and fundamental indicators, E L may actually be approaching a critical reversion point that can send shares even higher in January 2025.

Green Panda Capital

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Green Panda Capital has generated negative risk-adjusted returns adding no value to investors with long positions. Despite somewhat strong basic indicators, Green Panda is not utilizing all of its potentials. The recent stock price disturbance, may contribute to short-term losses for the investors.

Pair Trading with E L and Green Panda

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

The idea behind E L Financial Corp and Green Panda Capital 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 Portfolio Analyzer module to portfolio analysis module that provides access to portfolio diagnostics and optimization engine.