Correlation Between Ecovyst and Constellium

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

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

Diversification Opportunities for Ecovyst and Constellium

0.61

Correlation Coefficient

Ecovyst  Constellium

Poor diversification

The 3 months correlation between Ecovyst and Constellium is 0.61. Overlapping area represents the amount of risk that can be diversified away by holding Ecovyst and Constellium Nv in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Constellium Nv and Ecovyst 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 Ecovyst are associated (or correlated) with Constellium. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Constellium Nv has no effect on the direction of Ecovyst i.e., Ecovyst and Constellium go up and down completely randomly.

Pair Corralation between Ecovyst and Constellium

Given the investment horizon of 90 days Ecovyst is expected to generate 0.75 times more return on investment than Constellium. However, Ecovyst is 1.33 times less risky than Constellium. It trades about 0.12 of its potential returns per unit of risk. Constellium Nv is currently generating about 0.07 per unit of risk. If you would invest  760.00  in Ecovyst on July 1, 2025 and sell it today you would earn a total of  120.00  from holding Ecovyst or generate 15.79% return on investment over 90 days.

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

Ecovyst  vs.  Constellium Nv

Ecovyst

Risk-Adjusted Performance

Fair

Compared to the overall equity markets, risk-adjusted returns on investments in Ecovyst are ranked lower than 9 (%) of all global equities and portfolios over the last 90 days. In spite of comparatively unsteady basic indicators, Ecovyst unveiled solid returns over the last few months and may actually be approaching a breakup point.

Constellium Nv

Risk-Adjusted Performance

Mild

Compared to the overall equity markets, risk-adjusted returns on investments in Constellium Nv are ranked lower than 5 (%) of all global equities and portfolios over the last 90 days. In spite of very uncertain basic indicators, Constellium may actually be approaching a critical reversion point that can send shares even higher in October 2025.

Pair Trading with Ecovyst and Constellium

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

The idea behind Ecovyst and Constellium Nv 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.

Check out your portfolio center.

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 Performance Analysis module to check effects of mean-variance optimization against your current asset allocation.