Correlation Between Embark Commodity and Ep Emerging

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

By analyzing existing cross correlation between Embark Commodity Strategy and Ep Emerging Markets, you can compare the effects of market volatilities on Embark Commodity and Ep Emerging 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 Embark Commodity with a short position of Ep Emerging. Check out your portfolio center. Please also check ongoing floating volatility patterns of Embark Commodity and Ep Emerging.

Diversification Opportunities for Embark Commodity and Ep Emerging

0.33

Correlation Coefficient

Embark Commodity  Ep Emerging

Weak diversification

The 3 months correlation between Embark and EPASX is 0.33. Overlapping area represents the amount of risk that can be diversified away by holding Embark Commodity Strategy and Ep Emerging Markets in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Ep Emerging Markets and Embark Commodity 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 Embark Commodity Strategy are associated (or correlated) with Ep Emerging. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Ep Emerging Markets has no effect on the direction of Embark Commodity i.e., Embark Commodity and Ep Emerging go up and down completely randomly.

Pair Corralation between Embark Commodity and Ep Emerging

Assuming the 90 days horizon Embark Commodity is expected to generate 6.48 times less return on investment than Ep Emerging. In addition to that, Embark Commodity is 1.15 times more volatile than Ep Emerging Markets. It trades about 0.04 of its total potential returns per unit of risk. Ep Emerging Markets is currently generating about 0.28 per unit of volatility. If you would invest  1,035  in Ep Emerging Markets on May 18, 2025 and sell it today you would earn a total of  109.00  from holding Ep Emerging Markets or generate 10.53% return on investment over 90 days.

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

Embark Commodity Strategy  vs.  Ep Emerging Markets

Embark Commodity Strategy

Risk-Adjusted Performance

Weak

Compared to the overall equity markets, risk-adjusted returns on investments in Embark Commodity Strategy are ranked lower than 2 (%) of all funds and portfolios of funds over the last 90 days. In spite of fairly strong basic indicators, Embark Commodity is not utilizing all of its potentials. The current stock price disturbance, may contribute to short-term losses for the investors.

Ep Emerging Markets

Risk-Adjusted Performance

Solid

Compared to the overall equity markets, risk-adjusted returns on investments in Ep Emerging Markets are ranked lower than 21 (%) of all funds and portfolios of funds over the last 90 days. In spite of fairly weak basic indicators, Ep Emerging may actually be approaching a critical reversion point that can send shares even higher in September 2025.

Pair Trading with Embark Commodity and Ep Emerging

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

The idea behind Embark Commodity Strategy and Ep Emerging Markets 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 Insider Screener module to find insiders across different sectors to evaluate their impact on performance.