Correlation Between ESGL Holdings and 532457BU1

Specify exactly 2 symbols:
Can any of the company-specific risk be diversified away by investing in both ESGL Holdings and 532457BU1 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 ESGL Holdings and 532457BU1 into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between ESGL Holdings Limited and ELI LILLY AND, you can compare the effects of market volatilities on ESGL Holdings and 532457BU1 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 ESGL Holdings with a short position of 532457BU1. Check out your portfolio center. Please also check ongoing floating volatility patterns of ESGL Holdings and 532457BU1.

Diversification Opportunities for ESGL Holdings and 532457BU1

ESGL532457BU1Diversified AwayESGL532457BU1Diversified Away100%
-0.59
  Correlation Coefficient

Excellent diversification

The 3 months correlation between ESGL and 532457BU1 is -0.59. Overlapping area represents the amount of risk that can be diversified away by holding ESGL Holdings Limited and ELI LILLY AND in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on ELI LILLY AND and ESGL Holdings 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 ESGL Holdings Limited are associated (or correlated) with 532457BU1. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of ELI LILLY AND has no effect on the direction of ESGL Holdings i.e., ESGL Holdings and 532457BU1 go up and down completely randomly.

Pair Corralation between ESGL Holdings and 532457BU1

Assuming the 90 days horizon ESGL Holdings Limited is expected to generate 6.47 times more return on investment than 532457BU1. However, ESGL Holdings is 6.47 times more volatile than ELI LILLY AND. It trades about 0.12 of its potential returns per unit of risk. ELI LILLY AND is currently generating about -0.07 per unit of risk. If you would invest  1.00  in ESGL Holdings Limited on October 16, 2024 and sell it today you would earn a total of  0.37  from holding ESGL Holdings Limited or generate 37.0% return on investment over 90 days.
Time Period3 Months [change]
DirectionMoves Against 
StrengthVery Weak
Accuracy81.63%
ValuesDaily Returns

ESGL Holdings Limited  vs.  ELI LILLY AND

 Performance 
JavaScript chart by amCharts 3.21.15OctNovDec -2002040
JavaScript chart by amCharts 3.21.15ESGLW 532457BU1
       Timeline  
ESGL Holdings Limited 

Risk-Adjusted Performance

9 of 100

 
Weak
 
Strong
OK
Compared to the overall equity markets, risk-adjusted returns on investments in ESGL Holdings Limited are ranked lower than 9 (%) of all global equities and portfolios over the last 90 days. In spite of fairly unsteady essential indicators, ESGL Holdings showed solid returns over the last few months and may actually be approaching a breakup point.
JavaScript chart by amCharts 3.21.15OctNovDecJanNovDecJan0.0060.0080.010.0120.0140.0160.018
ELI LILLY AND 

Risk-Adjusted Performance

0 of 100

 
Weak
 
Strong
Very Weak
Over the last 90 days ELI LILLY AND has generated negative risk-adjusted returns adding no value to investors with long positions. Despite latest weak performance, the Bond's basic indicators remain strong and the current disturbance on Wall Street may also be a sign of long term gains for ELI LILLY AND investors.
JavaScript chart by amCharts 3.21.154023802250249024788082848688

ESGL Holdings and 532457BU1 Volatility Contrast

   Predicted Return Density   
JavaScript chart by amCharts 3.21.15-42.29-31.68-21.06-10.440.011.0622.1233.1844.25 0.020.040.060.080.100.120.14
JavaScript chart by amCharts 3.21.15ESGLW 532457BU1
       Returns  

Pair Trading with ESGL Holdings and 532457BU1

The main advantage of trading using opposite ESGL Holdings and 532457BU1 positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if ESGL Holdings position performs unexpectedly, 532457BU1 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 532457BU1 will offset losses from the drop in 532457BU1's long position.
The idea behind ESGL Holdings Limited and ELI LILLY AND 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 Volatility Analysis module to get historical volatility and risk analysis based on latest market data.

Other Complementary Tools

Funds Screener
Find actively-traded funds from around the world traded on over 30 global exchanges
Price Ceiling Movement
Calculate and plot Price Ceiling Movement for different equity instruments
Top Crypto Exchanges
Search and analyze digital assets across top global cryptocurrency exchanges
Volatility Analysis
Get historical volatility and risk analysis based on latest market data
Price Exposure Probability
Analyze equity upside and downside potential for a given time horizon across multiple markets