Correlation Between EDreams Odigeo and Iffe Futura

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

By analyzing existing cross correlation between eDreams Odigeo SA and Iffe Futura SA, you can compare the effects of market volatilities on EDreams Odigeo and Iffe Futura 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 EDreams Odigeo with a short position of Iffe Futura. Check out your portfolio center. Please also check ongoing floating volatility patterns of EDreams Odigeo and Iffe Futura.

Diversification Opportunities for EDreams Odigeo and Iffe Futura

0.61

Correlation Coefficient

EDreams Odigeo  Iffe Futura

Poor diversification

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

Pair Corralation between EDreams Odigeo and Iffe Futura

Assuming the 90 days trading horizon EDreams Odigeo is expected to generate 1.03 times less return on investment than Iffe Futura. In addition to that, EDreams Odigeo is 1.25 times more volatile than Iffe Futura SA. It trades about 0.11 of its total potential returns per unit of risk. Iffe Futura SA is currently generating about 0.14 per unit of volatility. If you would invest  63.00  in Iffe Futura SA on April 24, 2025 and sell it today you would earn a total of  9.00  from holding Iffe Futura SA or generate 14.29% return on investment over 90 days.

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

eDreams Odigeo SA  vs.  Iffe Futura SA

eDreams Odigeo SA

Risk-Adjusted Performance

OK

Compared to the overall equity markets, risk-adjusted returns on investments in eDreams Odigeo SA are ranked lower than 8 (%) of all global equities and portfolios over the last 90 days. In spite of rather unsteady basic indicators, EDreams Odigeo exhibited solid returns over the last few months and may actually be approaching a breakup point.

Iffe Futura SA

Risk-Adjusted Performance

Good

Compared to the overall equity markets, risk-adjusted returns on investments in Iffe Futura SA are ranked lower than 10 (%) of all global equities and portfolios over the last 90 days. In spite of rather unsteady basic indicators, Iffe Futura exhibited solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with EDreams Odigeo and Iffe Futura

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

The idea behind eDreams Odigeo SA and Iffe Futura SA 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 Equity Forecasting module to use basic forecasting models to generate price predictions and determine price momentum.