Correlation Between EUBEL BRADY and NATIONWIDE INFLATION

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

By analyzing existing cross correlation between EUBEL BRADY SUTTMAN and NATIONWIDE INFLATION PROTECTED SECURITIES, you can compare the effects of market volatilities on EUBEL BRADY and NATIONWIDE INFLATION 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 EUBEL BRADY with a short position of NATIONWIDE INFLATION. Check out your portfolio center. Please also check ongoing floating volatility patterns of EUBEL BRADY and NATIONWIDE INFLATION.

Diversification Opportunities for EUBEL BRADY and NATIONWIDE INFLATION

0.7

Correlation Coefficient

EUBEL BRADY NATIONWIDE INFLATION

Poor diversification

The 3 months correlation between EUBEL and NATIONWIDE is 0.7. Overlapping area represents the amount of risk that can be diversified away by holding EUBEL BRADY SUTTMAN and NATIONWIDE INFLATION-PROTECTED in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on NATIONWIDE INFLATION and EUBEL BRADY 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 EUBEL BRADY SUTTMAN are associated (or correlated) with NATIONWIDE INFLATION. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of NATIONWIDE INFLATION has no effect on the direction of EUBEL BRADY i.e., EUBEL BRADY and NATIONWIDE INFLATION go up and down completely randomly.

Pair Corralation between EUBEL BRADY and NATIONWIDE INFLATION

Assuming the 90 days horizon EUBEL BRADY SUTTMAN is expected to generate 0.54 times more return on investment than NATIONWIDE INFLATION. However, EUBEL BRADY SUTTMAN is 1.84 times less risky than NATIONWIDE INFLATION. It trades about -0.19 of its potential returns per unit of risk. NATIONWIDE INFLATION PROTECTED SECURITIES is currently generating about -0.14 per unit of risk. If you would invest  943.00  in EUBEL BRADY SUTTMAN on March 6, 2023 and sell it today you would lose (12.00)  from holding EUBEL BRADY SUTTMAN or give up 1.27% of portfolio value over 90 days.

EUBEL BRADY SUTTMAN  vs.  NATIONWIDE INFLATION-PROTECTED

EUBEL BRADY SUTTMAN

EUBEL Performance

2 of 100

Compared to the overall equity markets, risk-adjusted returns on investments in EUBEL BRADY SUTTMAN are ranked lower than 2 (%) of all funds and portfolios of funds over the last 90 days. In spite of fairly strong technical and fundamental indicators, EUBEL BRADY is not utilizing all of its potentials. The current stock price disturbance, may contribute to short-term losses for the investors.

NATIONWIDE INFLATION

NATIONWIDE Performance

3 of 100

Compared to the overall equity markets, risk-adjusted returns on investments in NATIONWIDE INFLATION PROTECTED SECURITIES are ranked lower than 3 (%) of all funds and portfolios of funds over the last 90 days. In spite of fairly strong basic indicators, NATIONWIDE INFLATION is not utilizing all of its potentials. The current stock price disturbance, may contribute to short-term losses for the investors.

Pair Trading with EUBEL BRADY and NATIONWIDE INFLATION

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

The idea behind EUBEL BRADY SUTTMAN and NATIONWIDE INFLATION PROTECTED SECURITIES 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 Equity Search module to search for actively traded equities including funds and ETFs from over 30 global markets.