Correlation Between Euro Tech and C E

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

Diversification Opportunities for Euro Tech and C E

0.75
  Correlation Coefficient

Poor diversification

The 3 months correlation between Euro Tech and C E is 0.75. Overlapping area represents the amount of risk that can be diversified away by holding Euro Tech Holdings and C E C in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on C E C and Euro Tech 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 Euro Tech Holdings are associated (or correlated) with C E. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of C E C has no effect on the direction of Euro Tech i.e., Euro Tech and C E go up and down completely randomly.

Pair Corralation between Euro Tech and C E

Given the investment horizon of 90 days Euro Tech Holdings is expected to under-perform the C E. In addition to that, Euro Tech is 1.55 times more volatile than C E C. It trades about -0.2 of its total potential returns per unit of risk. C E C is currently generating about 0.0 per unit of volatility. If you would invest  890.00  in C E C on July 4, 2022 and sell it today you would lose (5.00)  from holding C E C or give up 0.56% of portfolio value over 90 days.
Time Period3 Months [change]
DirectionMoves Together 
StrengthSignificant
Accuracy100.0%
ValuesDaily Returns

Euro Tech Holdings  vs.  C E C

 Performance (%) 
       Timeline  
Euro Tech Holdings 
Euro Tech Performance
3 of 100
Compared to the overall equity markets, risk-adjusted returns on investments in Euro Tech Holdings are ranked lower than 3 (%) of all global equities and portfolios over the last 90 days. In spite of comparatively conflicting basic indicators, Euro Tech unveiled solid returns over the last few months and may actually be approaching a breakup point.

Euro Tech Price Channel

C E C 
C E Performance
16 of 100
Compared to the overall equity markets, risk-adjusted returns on investments in C E C are ranked lower than 16 (%) of all global equities and portfolios over the last 90 days. In spite of rather conflicting fundamental indicators, C E exhibited solid returns over the last few months and may actually be approaching a breakup point.

C E Price Channel

Euro Tech and C E Volatility Contrast

   Predicted Return Density   
       Returns  

Pair Trading with Euro Tech and C E

The main advantage of trading using opposite Euro Tech and C E positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Euro Tech position performs unexpectedly, C E 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 C E will offset losses from the drop in C E's long position.
Euro Tech vs. Amazon Inc
The idea behind Euro Tech Holdings and C E C 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.
C E vs. Amazon Inc
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 Money Managers module to screen money managers from public funds and ETFs managed around the world.

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