Correlation Between Energous and Eastman Kodak
Can any of the company-specific risk be diversified away by investing in both Energous and Eastman Kodak 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 Energous and Eastman Kodak into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Energous and Eastman Kodak Co, you can compare the effects of market volatilities on Energous and Eastman Kodak 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 Energous with a short position of Eastman Kodak. Check out your portfolio center. Please also check ongoing floating volatility patterns of Energous and Eastman Kodak.
Diversification Opportunities for Energous and Eastman Kodak
-0.01 | Correlation Coefficient |
Good diversification
The 3 months correlation between Energous and Eastman is -0.01. Overlapping area represents the amount of risk that can be diversified away by holding Energous and Eastman Kodak Co in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Eastman Kodak and Energous 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 Energous are associated (or correlated) with Eastman Kodak. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Eastman Kodak has no effect on the direction of Energous i.e., Energous and Eastman Kodak go up and down completely randomly.
Pair Corralation between Energous and Eastman Kodak
Given the investment horizon of 90 days Energous is expected to under-perform the Eastman Kodak. In addition to that, Energous is 1.31 times more volatile than Eastman Kodak Co. It trades about -0.08 of its total potential returns per unit of risk. Eastman Kodak Co is currently generating about 0.05 per unit of volatility. If you would invest 331.00 in Eastman Kodak Co on January 19, 2024 and sell it today you would earn a total of 142.00 from holding Eastman Kodak Co or generate 42.9% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Energous vs. Eastman Kodak Co
Performance |
| Timeline |
| Energous |
| Eastman Kodak |
Energous and Eastman Kodak Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Energous and Eastman Kodak
The main advantage of trading using opposite Energous and Eastman Kodak positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Energous position performs unexpectedly, Eastman Kodak 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 Eastman Kodak will offset losses from the drop in Eastman Kodak's long position.The idea behind Energous and Eastman Kodak Co 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.| Eastman Kodak vs. SMX Public Limited | Eastman Kodak vs. System1 | Eastman Kodak vs. Lichen China Limited | Eastman Kodak vs. Team Inc |
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 Premium Stories module to follow Macroaxis premium stories from verified contributors across different equity types, categories and coverage scope.
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