Correlation Between Easy Software and ATRESMEDIA

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

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

Diversification Opportunities for Easy Software and ATRESMEDIA

0.14

Correlation Coefficient

Easy Software  ATRESMEDIA

Average diversification

The 3 months correlation between Easy and ATRESMEDIA is 0.14. Overlapping area represents the amount of risk that can be diversified away by holding Easy Software AG and ATRESMEDIA in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on ATRESMEDIA and Easy Software 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 Easy Software AG are associated (or correlated) with ATRESMEDIA. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of ATRESMEDIA has no effect on the direction of Easy Software i.e., Easy Software and ATRESMEDIA go up and down completely randomly.

Pair Corralation between Easy Software and ATRESMEDIA

Assuming the 90 days trading horizon Easy Software AG is expected to under-perform the ATRESMEDIA. In addition to that, Easy Software is 1.47 times more volatile than ATRESMEDIA. It trades about 0.0 of its total potential returns per unit of risk. ATRESMEDIA is currently generating about 0.2 per unit of volatility. If you would invest  430.00  in ATRESMEDIA on December 23, 2024 and sell it today you would earn a total of  85.00  from holding ATRESMEDIA or generate 19.77% return on investment over 90 days.

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

Easy Software AG  vs.  ATRESMEDIA

Easy Software AG

Risk-Adjusted Performance

Very Weak

Over the last 90 days Easy Software AG has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of very healthy basic indicators, Easy Software is not utilizing all of its potentials. The newest stock price disarray, may contribute to short-term losses for the investors.

ATRESMEDIA

Risk-Adjusted Performance

Good

Compared to the overall equity markets, risk-adjusted returns on investments in ATRESMEDIA are ranked lower than 15 (%) of all global equities and portfolios over the last 90 days. In spite of rather uncertain technical and fundamental indicators, ATRESMEDIA exhibited solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with Easy Software and ATRESMEDIA

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

The idea behind Easy Software AG and ATRESMEDIA 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 ETF Categories module to list of ETF categories grouped based on various criteria, such as the investment strategy or type of investments.