Correlation Between Investment and EVN Finance

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

By analyzing existing cross correlation between Investment And Construction and EVN Finance JSC, you can compare the effects of market volatilities on Investment and EVN Finance 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 Investment with a short position of EVN Finance. Check out your portfolio center. Please also check ongoing floating volatility patterns of Investment and EVN Finance.

Diversification Opportunities for Investment and EVN Finance

0.47

Correlation Coefficient

Investment  EVN Finance

Very weak diversification

The 3 months correlation between Investment and EVN is 0.47. Overlapping area represents the amount of risk that can be diversified away by holding Investment And Construction and EVN Finance JSC in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on EVN Finance JSC and Investment 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 Investment And Construction are associated (or correlated) with EVN Finance. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of EVN Finance JSC has no effect on the direction of Investment i.e., Investment and EVN Finance go up and down completely randomly.

Pair Corralation between Investment and EVN Finance

Assuming the 90 days trading horizon Investment And Construction is expected to generate 2.16 times more return on investment than EVN Finance. However, Investment is 2.16 times more volatile than EVN Finance JSC. It trades about 0.06 of its potential returns per unit of risk. EVN Finance JSC is currently generating about 0.03 per unit of risk. If you would invest  390,000  in Investment And Construction on October 10, 2024 and sell it today you would earn a total of  620,000  from holding Investment And Construction or generate 158.97% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Together
Strength	Weak
Accuracy	93.7%
Values	Daily Returns

Investment And Construction  vs.  EVN Finance JSC

Investment And Const

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Investment And Construction has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of unfluctuating performance in the last few months, the Stock's basic indicators remain very healthy which may send shares a bit higher in February 2025. The recent disarray may also be a sign of long period up-swing for the firm investors.

EVN Finance JSC

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days EVN Finance JSC has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of unfluctuating performance in the last few months, the Stock's technical and fundamental indicators remain very healthy which may send shares a bit higher in February 2025. The recent disarray may also be a sign of long period up-swing for the firm investors.

Pair Trading with Investment and EVN Finance

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

The idea behind Investment And Construction and EVN Finance JSC 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 Stock Tickers module to use high-impact, comprehensive, and customizable stock tickers that can be easily integrated to any websites.