Correlation Between EPlus and ShiftCarbon

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

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

Diversification Opportunities for EPlus and ShiftCarbon

0.0

Correlation Coefficient

EPlus  ShiftCarbon

Pay attention - limited upside

The 3 months correlation between EPlus and ShiftCarbon is 0.0. Overlapping area represents the amount of risk that can be diversified away by holding ePlus inc and ShiftCarbon in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on ShiftCarbon and EPlus 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 ePlus inc are associated (or correlated) with ShiftCarbon. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of ShiftCarbon has no effect on the direction of EPlus i.e., EPlus and ShiftCarbon go up and down completely randomly.

Pair Corralation between EPlus and ShiftCarbon

If you would invest  7,463  in ePlus inc on September 15, 2024 and sell it today you would earn a total of  251.00  from holding ePlus inc or generate 3.36% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Flat
Strength	Insignificant
Accuracy	65.08%
Values	Daily Returns

ePlus inc  vs.  ShiftCarbon

ePlus inc

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days ePlus inc has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of weak performance in the last few months, the Stock's basic indicators remain comparatively stable which may send shares a bit higher in January 2025. The newest uproar may also be a sign of mid-term up-swing for the firm private investors.

ShiftCarbon

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days ShiftCarbon has generated negative risk-adjusted returns adding no value to investors with long positions. Despite nearly stable technical and fundamental indicators, ShiftCarbon is not utilizing all of its potentials. The latest stock price disturbance, may contribute to mid-run losses for the stockholders.

Pair Trading with EPlus and ShiftCarbon

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

The idea behind ePlus inc and ShiftCarbon 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 Volatility Analysis module to get historical volatility and risk analysis based on latest market data.