Correlation Between Ecovyst and Blue Hat

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

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

Diversification Opportunities for Ecovyst and Blue Hat

-0.19

Correlation Coefficient

Ecovyst  Blue Hat

Good diversification

The 3 months correlation between Ecovyst and Blue is -0.19. Overlapping area represents the amount of risk that can be diversified away by holding Ecovyst and Blue Hat Interactive in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Blue Hat Interactive and Ecovyst 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 Ecovyst are associated (or correlated) with Blue Hat. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Blue Hat Interactive has no effect on the direction of Ecovyst i.e., Ecovyst and Blue Hat go up and down completely randomly.

Pair Corralation between Ecovyst and Blue Hat

Given the investment horizon of 90 days Ecovyst is expected to generate 1.99 times less return on investment than Blue Hat. But when comparing it to its historical volatility, Ecovyst is 1.82 times less risky than Blue Hat. It trades about 0.02 of its potential returns per unit of risk. Blue Hat Interactive is currently generating about 0.02 of returns per unit of risk over similar time horizon. If you would invest  109.00  in Blue Hat Interactive on March 12, 2024 and sell it today you would earn a total of  1.00  from holding Blue Hat Interactive or generate 0.92% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Against
Strength	Insignificant
Accuracy	100.0%
Values	Daily Returns

Ecovyst  vs.  Blue Hat Interactive

Ecovyst

Risk-Adjusted Performance

1 of 100

Weak

Compared to the overall equity markets, risk-adjusted returns on investments in Ecovyst are ranked lower than 1 (%) of all global equities and portfolios over the last 90 days. In spite of comparatively stable basic indicators, Ecovyst is not utilizing all of its potentials. The recent stock price uproar, may contribute to short-horizon losses for the private investors.

Blue Hat Interactive

Risk-Adjusted Performance

1 of 100

Weak

Compared to the overall equity markets, risk-adjusted returns on investments in Blue Hat Interactive are ranked lower than 1 (%) of all global equities and portfolios over the last 90 days. In spite of comparatively stable basic indicators, Blue Hat is not utilizing all of its potentials. The current stock price uproar, may contribute to short-horizon losses for the private investors.

Pair Trading with Ecovyst and Blue Hat

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

The idea behind Ecovyst and Blue Hat Interactive 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 Portfolio Center module to all portfolio management and optimization tools to improve performance of your portfolios.