Correlation Between Elvalhalcor Hellenic and Cenergy Holdings

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

By analyzing existing cross correlation between Elvalhalcor Hellenic Copper and Cenergy Holdings SA, you can compare the effects of market volatilities on Elvalhalcor Hellenic and Cenergy Holdings 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 Elvalhalcor Hellenic with a short position of Cenergy Holdings. Check out your portfolio center. Please also check ongoing floating volatility patterns of Elvalhalcor Hellenic and Cenergy Holdings.

Diversification Opportunities for Elvalhalcor Hellenic and Cenergy Holdings

0.57

Correlation Coefficient

Elvalhalcor Hellenic  Cenergy Holdings

Very weak diversification

The 3 months correlation between Elvalhalcor and Cenergy is 0.57. Overlapping area represents the amount of risk that can be diversified away by holding Elvalhalcor Hellenic Copper and Cenergy Holdings SA in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Cenergy Holdings and Elvalhalcor Hellenic 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 Elvalhalcor Hellenic Copper are associated (or correlated) with Cenergy Holdings. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Cenergy Holdings has no effect on the direction of Elvalhalcor Hellenic i.e., Elvalhalcor Hellenic and Cenergy Holdings go up and down completely randomly.

Pair Corralation between Elvalhalcor Hellenic and Cenergy Holdings

Assuming the 90 days trading horizon Elvalhalcor Hellenic Copper is expected to under-perform the Cenergy Holdings. In addition to that, Elvalhalcor Hellenic is 1.03 times more volatile than Cenergy Holdings SA. It trades about -0.01 of its total potential returns per unit of risk. Cenergy Holdings SA is currently generating about 0.03 per unit of volatility. If you would invest  868.00  in Cenergy Holdings SA on September 13, 2024 and sell it today you would earn a total of  49.00  from holding Cenergy Holdings SA or generate 5.65% return on investment over 90 days.

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

Elvalhalcor Hellenic Copper  vs.  Cenergy Holdings SA

Elvalhalcor Hellenic

Risk-Adjusted Performance

1 of 100

Weak

Compared to the overall equity markets, risk-adjusted returns on investments in Elvalhalcor Hellenic Copper are ranked lower than 1 (%) of all global equities and portfolios over the last 90 days. In spite of comparatively stable basic indicators, Elvalhalcor Hellenic is not utilizing all of its potentials. The current stock price uproar, may contribute to short-horizon losses for the private investors.

Cenergy Holdings

Risk-Adjusted Performance

0 of 100

Very Weak

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

Pair Trading with Elvalhalcor Hellenic and Cenergy Holdings

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

The idea behind Elvalhalcor Hellenic Copper and Cenergy Holdings SA 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 Equity Valuation module to check real value of public entities based on technical and fundamental data.