Correlation Between GEK TERNA and Ekter SA

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

By analyzing existing cross correlation between GEK TERNA Holdings and Ekter SA, you can compare the effects of market volatilities on GEK TERNA and Ekter SA 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 GEK TERNA with a short position of Ekter SA. Check out your portfolio center. Please also check ongoing floating volatility patterns of GEK TERNA and Ekter SA.

Diversification Opportunities for GEK TERNA and Ekter SA

-0.15

Correlation Coefficient

GEK TERNA  Ekter SA

Good diversification

The 3 months correlation between GEK and Ekter is -0.15. Overlapping area represents the amount of risk that can be diversified away by holding GEK TERNA Holdings and Ekter SA in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Ekter SA and GEK TERNA 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 GEK TERNA Holdings are associated (or correlated) with Ekter SA. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Ekter SA has no effect on the direction of GEK TERNA i.e., GEK TERNA and Ekter SA go up and down completely randomly.

Pair Corralation between GEK TERNA and Ekter SA

Assuming the 90 days trading horizon GEK TERNA Holdings is expected to generate 0.31 times more return on investment than Ekter SA. However, GEK TERNA Holdings is 3.18 times less risky than Ekter SA. It trades about 0.13 of its potential returns per unit of risk. Ekter SA is currently generating about -0.04 per unit of risk. If you would invest  1,728  in GEK TERNA Holdings on September 15, 2024 and sell it today you would earn a total of  126.00  from holding GEK TERNA Holdings or generate 7.29% return on investment over 90 days.

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

GEK TERNA Holdings  vs.  Ekter SA

GEK TERNA Holdings

Risk-Adjusted Performance

10 of 100

OK

Compared to the overall equity markets, risk-adjusted returns on investments in GEK TERNA Holdings are ranked lower than 10 (%) of all global equities and portfolios over the last 90 days. In spite of very uncertain technical and fundamental indicators, GEK TERNA may actually be approaching a critical reversion point that can send shares even higher in January 2025.

Ekter SA

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Ekter SA has generated negative risk-adjusted returns adding no value to investors with long positions. Despite latest unfluctuating performance, the Stock's basic indicators remain strong and the current disturbance on Wall Street may also be a sign of long term gains for the company investors.

Pair Trading with GEK TERNA and Ekter SA

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

The idea behind GEK TERNA Holdings and Ekter SA 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.

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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 Instant Ratings module to determine any equity ratings based on digital recommendations. Macroaxis instant equity ratings are based on combination of fundamental analysis and risk-adjusted market performance.