Correlation Between Enel Generacin and Roche Holding
Can any of the company-specific risk be diversified away by investing in both Enel Generacin and Roche Holding 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 Enel Generacin and Roche Holding into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Enel Generacin Chile and Roche Holding AG, you can compare the effects of market volatilities on Enel Generacin and Roche Holding 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 Enel Generacin with a short position of Roche Holding. Check out your portfolio center. Please also check ongoing floating volatility patterns of Enel Generacin and Roche Holding.
Diversification Opportunities for Enel Generacin and Roche Holding
0.0 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between Enel and Roche is 0.0. Overlapping area represents the amount of risk that can be diversified away by holding Enel Generacin Chile and Roche Holding AG in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Roche Holding AG and Enel Generacin 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 Enel Generacin Chile are associated (or correlated) with Roche Holding. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Roche Holding AG has no effect on the direction of Enel Generacin i.e., Enel Generacin and Roche Holding go up and down completely randomly.
Pair Corralation between Enel Generacin and Roche Holding
If you would invest 26,969 in Roche Holding AG on January 25, 2024 and sell it today you would lose (186.00) from holding Roche Holding AG or give up 0.69% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Flat |
| Strength | Insignificant |
| Accuracy | 2.38% |
| Values | Daily Returns |
Enel Generacin Chile vs. Roche Holding AG
Performance |
| Timeline |
| Enel Generacin Chile |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Very Weak
| Roche Holding AG |
Enel Generacin and Roche Holding Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Enel Generacin and Roche Holding
The main advantage of trading using opposite Enel Generacin and Roche Holding positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Enel Generacin position performs unexpectedly, Roche Holding 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 Roche Holding will offset losses from the drop in Roche Holding's long position.| Enel Generacin vs. Zoom Video Communications | Enel Generacin vs. United Rentals | Enel Generacin vs. Triton International Limited | Enel Generacin vs. Mitsubishi UFJ Lease |
| Roche Holding vs. Novartis AG | Roche Holding vs. AstraZeneca PLC | Roche Holding vs. Roche Holding Ltd | Roche Holding vs. Sanofi ADR |
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 Portfolio Volatility module to check portfolio volatility and analyze historical return density to properly model market risk.
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