Correlation Between Blucora and Ecolab

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

Diversification Opportunities for Blucora and Ecolab

0.88
  Correlation Coefficient

Very poor diversification

The 3 months correlation between Blucora and Ecolab is 0.88. Overlapping area represents the amount of risk that can be diversified away by holding Blucora and Ecolab Inc in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Ecolab Inc and Blucora 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 Blucora are associated (or correlated) with Ecolab. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Ecolab Inc has no effect on the direction of Blucora i.e., Blucora and Ecolab go up and down completely randomly.

Pair Corralation between Blucora and Ecolab

Given the investment horizon of 90 days Blucora is expected to generate 1.23 times more return on investment than Ecolab. However, Blucora is 1.23 times more volatile than Ecolab Inc. It trades about 0.06 of its potential returns per unit of risk. Ecolab Inc is currently generating about -0.06 per unit of risk. If you would invest  1,580  in Blucora on June 27, 2022 and sell it today you would earn a total of  329.00  from holding Blucora or generate 20.82% return on investment over 90 days.
Time Period3 Months [change]
DirectionMoves Together 
StrengthStrong
Accuracy99.4%
ValuesDaily Returns

Blucora  vs.  Ecolab Inc

 Performance (%) 
       Timeline  
Blucora 
Blucora Performance
1 of 100
Compared to the overall equity markets, risk-adjusted returns on investments in Blucora are ranked lower than 1 (%) of all global equities and portfolios over the last 90 days. Even with relatively invariable basic indicators, Blucora is not utilizing all of its potentials. The latest stock price agitation, may contribute to short-term losses for the retail investors.

Blucora Price Channel

Ecolab Inc 
Ecolab Performance
0 of 100
Over the last 90 days Ecolab Inc has generated negative risk-adjusted returns adding no value to investors with long positions. Even with relatively steady fundamental indicators, Ecolab is not utilizing all of its potentials. The current stock price chaos, may contribute to medium-term losses for the stakeholders.

Ecolab Price Channel

Blucora and Ecolab Volatility Contrast

   Predicted Return Density   
       Returns  

Pair Trading with Blucora and Ecolab

The main advantage of trading using opposite Blucora and Ecolab positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Blucora position performs unexpectedly, Ecolab 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 Ecolab will offset losses from the drop in Ecolab's long position.
Blucora vs. McDonalds Corp
The idea behind Blucora and Ecolab Inc 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.
Ecolab vs. Industrias Bachoco SA
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 Price Transformation module to use Price Transformation models to analyze depth of different equity instruments across global markets.

Other Complementary Tools

Technical Analysis
Check basic technical indicators and analysis based on most latest market data
Go
Bollinger Bands
Use Bollinger Bands indicator to analyze target price for a given investing horizon
Go
Portfolio Center
All portfolio management and optimization tools to improve performance of your portfolios
Go
Equity Search
Search for actively traded equities including funds and ETFs from over 30 global markets
Go
Content Syndication
Quickly integrate customizable finance content to your own investment portal
Go
Insider Screener
Find insiders across different sectors to evaluate their impact on performance
Go
Volatility Analysis
Get historical volatility and risk analysis based on latest market data
Go
Probability Of Bankruptcy
Get analysis of equity chance of financial distress in the next 2 years
Go
Equity Valuation
Check real value of public entities based on technical and fundamental data
Go
Balance Of Power
Check stock momentum by analyzing Balance Of Power indicator and other technical ratios
Go