Correlation Between Draganfly and Eve Holding

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

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

Diversification Opportunities for Draganfly and Eve Holding

0.78

Correlation Coefficient

Draganfly  Eve Holding

Poor diversification

The 3 months correlation between Draganfly and Eve is 0.78. Overlapping area represents the amount of risk that can be diversified away by holding Draganfly and Eve Holding in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Eve Holding and Draganfly 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 Draganfly are associated (or correlated) with Eve Holding. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Eve Holding has no effect on the direction of Draganfly i.e., Draganfly and Eve Holding go up and down completely randomly.

Pair Corralation between Draganfly and Eve Holding

Given the investment horizon of 90 days Draganfly is expected to under-perform the Eve Holding. In addition to that, Draganfly is 1.67 times more volatile than Eve Holding. It trades about -0.1 of its total potential returns per unit of risk. Eve Holding is currently generating about -0.17 per unit of volatility. If you would invest  589.00  in Eve Holding on January 6, 2025 and sell it today you would lose (256.00) from holding Eve Holding or give up 43.46% of portfolio value over 90 days.

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

Draganfly  vs.  Eve Holding

Draganfly

Risk-Adjusted Performance

Very Weak

Over the last 90 days Draganfly has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of unfluctuating performance in the last few months, the Stock's basic indicators remain very healthy which may send shares a bit higher in May 2025. The recent disarray may also be a sign of long period up-swing for the firm investors.

Eve Holding

Risk-Adjusted Performance

Very Weak

Over the last 90 days Eve Holding has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of inconsistent performance in the last few months, the Stock's technical and fundamental indicators remain fairly strong which may send shares a bit higher in May 2025. The current disturbance may also be a sign of long term up-swing for the company investors.

Pair Trading with Draganfly and Eve Holding

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

The idea behind Draganfly and Eve Holding 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 Balance Of Power module to check stock momentum by analyzing Balance Of Power indicator and other technical ratios.