Correlation Between EOS and ARK

Specify exactly 2 symbols:
Can any of the company-specific risk be diversified away by investing in both EOS and ARK 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 EOS and ARK into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between EOS and ARK, you can compare the effects of market volatilities on EOS and ARK 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 EOS with a short position of ARK. Check out your portfolio center. Please also check ongoing floating volatility patterns of EOS and ARK.

Diversification Opportunities for EOS and ARK

0.62
  Correlation Coefficient

Poor diversification

The 3 months correlation between EOS and ARK is 0.62. Overlapping area represents the amount of risk that can be diversified away by holding EOS and ARK in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on ARK and EOS 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 EOS are associated (or correlated) with ARK. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of ARK has no effect on the direction of EOS i.e., EOS and ARK go up and down completely randomly.

Pair Corralation between EOS and ARK

Assuming the 90 days trading horizon EOS is expected to generate 2.14 times more return on investment than ARK. However, EOS is 2.14 times more volatile than ARK. It trades about 0.27 of its potential returns per unit of risk. ARK is currently generating about 0.34 per unit of risk. If you would invest  98.00  in EOS on May 15, 2022 and sell it today you would earn a total of  31.00  from holding EOS or generate 31.63% return on investment over 90 days.
Time Period3 Months [change]
DirectionMoves Together 
StrengthSignificant
Accuracy100.0%
ValuesDaily Returns

EOS  vs.  ARK

 Performance (%) 
       Timeline  
EOS 
EOS Performance
0 of 100
Over the last 90 days EOS has generated negative risk-adjusted returns adding no value to investors with long positions. Despite somewhat strong basic indicators, EOS is not utilizing all of its potentials. The current stock price disturbance, may contribute to short-term losses for the investors.

EOS Price Channel

ARK 
ARK Performance
1 of 100
Compared to the overall equity markets, risk-adjusted returns on investments in ARK are ranked lower than 1 (%) of all global equities and portfolios over the last 90 days. Despite somewhat weak basic indicators, ARK may actually be approaching a critical reversion point that can send shares even higher in September 2022.

ARK Price Channel

EOS and ARK Volatility Contrast

   Predicted Return Density   
       Returns  

Pair Trading with EOS and ARK

The main advantage of trading using opposite EOS and ARK positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if EOS position performs unexpectedly, ARK 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 ARK will offset losses from the drop in ARK's long position.
The idea behind EOS and ARK 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 Earnings Calls module to check upcoming earnings announcements updated hourly across public exchanges.

Other Complementary Tools

Transaction History
View history of all your transactions and understand their impact on performance
Go
Fund Screener
Find actively-traded funds from around the world traded on over 30 global exchanges
Go
Crypto Correlations
Use cryptocurrency correlation module to diversify your cryptocurrency portfolio across multiple coins
Go
Equity Valuation
Check real value of public entities based on technical and fundamental data
Go
Companies Directory
Evaluate performance of over 100,000 Stocks, Funds, and ETFs against different fundamentals
Go
Performance Analysis
Check effects of mean-variance optimization against your current asset allocation
Go
Bond Directory
Find actively traded corporate debentures issued by US companies
Go
Idea Analyzer
Analyze all characteristics, volatility and risk-adjusted return of Macroaxis ideas
Go
Portfolio File Import
Quickly import all of your third-party portfolios from your local drive in csv format
Go
Risk-Return Analysis
View associations between returns expected from investment and the risk you assume
Go
Probability Of Bankruptcy
Get analysis of equity chance of financial distress in the next 2 years
Go
Volatility Analysis
Get historical volatility and risk analysis based on latest market data
Go
Price Exposure Probability
Analyze equity upside and downside potential for a given time horizon across multiple markets
Go