Correlation Between Wharf Holdings and EGRNF

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

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

Diversification Opportunities for Wharf Holdings and EGRNF

-0.24

Correlation Coefficient

Wharf Holdings  EGRNF

Very good diversification

The 3 months correlation between Wharf and EGRNF is -0.24. Overlapping area represents the amount of risk that can be diversified away by holding Wharf Holdings and EGRNF in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on EGRNF and Wharf 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 Wharf Holdings are associated (or correlated) with EGRNF. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of EGRNF has no effect on the direction of Wharf Holdings i.e., Wharf Holdings and EGRNF go up and down completely randomly.

Pair Corralation between Wharf Holdings and EGRNF

Assuming the 90 days horizon Wharf Holdings is expected to under-perform the EGRNF. But the pink sheet apears to be less risky and, when comparing its historical volatility, Wharf Holdings is 31.35 times less risky than EGRNF. The pink sheet trades about -0.05 of its potential returns per unit of risk. The EGRNF is currently generating about 0.11 of returns per unit of risk over similar time horizon. If you would invest  0.00  in EGRNF on December 28, 2024 and sell it today you would earn a total of  0.01  from holding EGRNF or generate 9.223372036854776E16% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Against
Strength	Insignificant
Accuracy	96.77%
Values	Daily Returns

Wharf Holdings  vs.  EGRNF

Wharf Holdings

Risk-Adjusted Performance

Very Weak

Over the last 90 days Wharf Holdings has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of weak performance in the last few months, the Stock's technical and fundamental indicators remain fairly strong which may send shares a bit higher in April 2025. The current disturbance may also be a sign of long term up-swing for the company investors.

EGRNF

Risk-Adjusted Performance

OK

Compared to the overall equity markets, risk-adjusted returns on investments in EGRNF are ranked lower than 8 (%) of all global equities and portfolios over the last 90 days. Despite nearly weak basic indicators, EGRNF reported solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with Wharf Holdings and EGRNF

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

The idea behind Wharf Holdings and EGRNF 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 Funds Screener module to find actively-traded funds from around the world traded on over 30 global exchanges.