Correlation Between Eco Wave and Credit Suisse

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

By analyzing existing cross correlation between Eco Wave Power and Credit Suisse Group, you can compare the effects of market volatilities on Eco Wave and Credit Suisse 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 Eco Wave with a short position of Credit Suisse. Check out your portfolio center. Please also check ongoing floating volatility patterns of Eco Wave and Credit Suisse.

Diversification Opportunities for Eco Wave and Credit Suisse

-0.41

Correlation Coefficient

Eco Wave  Credit Suisse

Very good diversification

The 3 months correlation between Eco and Credit is -0.41. Overlapping area represents the amount of risk that can be diversified away by holding Eco Wave Power and Credit Suisse Group in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Credit Suisse Group and Eco Wave 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 Eco Wave Power are associated (or correlated) with Credit Suisse. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Credit Suisse Group has no effect on the direction of Eco Wave i.e., Eco Wave and Credit Suisse go up and down completely randomly.

Pair Corralation between Eco Wave and Credit Suisse

Given the investment horizon of 90 days Eco Wave Power is expected to generate 1.93 times more return on investment than Credit Suisse. However, Eco Wave is 1.93 times more volatile than Credit Suisse Group. It trades about 0.05 of its potential returns per unit of risk. Credit Suisse Group is currently generating about -0.11 per unit of risk. If you would invest  389.00  in Eco Wave Power on September 10, 2024 and sell it today you would earn a total of  741.00  from holding Eco Wave Power or generate 190.49% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Against
Strength	Very Weak
Accuracy	24.44%
Values	Daily Returns

Eco Wave Power  vs.  Credit Suisse Group

Eco Wave Power

Risk-Adjusted Performance

15 of 100

Good

Compared to the overall equity markets, risk-adjusted returns on investments in Eco Wave Power are ranked lower than 15 (%) of all global equities and portfolios over the last 90 days. In spite of rather fragile basic indicators, Eco Wave exhibited solid returns over the last few months and may actually be approaching a breakup point.

Credit Suisse Group

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Credit Suisse Group has generated negative risk-adjusted returns adding no value to investors with long positions. Despite nearly stable forward-looking signals, Credit Suisse is not utilizing all of its potentials. The current stock price disturbance, may contribute to mid-run losses for the stockholders.

Pair Trading with Eco Wave and Credit Suisse

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

The idea behind Eco Wave Power and Credit Suisse Group 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 Analyst Advice module to analyst recommendations and target price estimates broken down by several categories.