Correlation Between Royal Bank and E L

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

By analyzing existing cross correlation between Royal Bank of and E L Financial Corp, you can compare the effects of market volatilities on Royal Bank and E L 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 Royal Bank with a short position of E L. Check out your portfolio center. Please also check ongoing floating volatility patterns of Royal Bank and E L.

Diversification Opportunities for Royal Bank and E L

0.92

Correlation Coefficient

Royal Bank  E L

Almost no diversification

The 3 months correlation between Royal and ELF-PF is 0.92. Overlapping area represents the amount of risk that can be diversified away by holding Royal Bank of and E L Financial Corp in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on E L Financial and Royal Bank 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 Royal Bank of are associated (or correlated) with E L. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of E L Financial has no effect on the direction of Royal Bank i.e., Royal Bank and E L go up and down completely randomly.

Pair Corralation between Royal Bank and E L

Assuming the 90 days trading horizon Royal Bank is expected to generate 2.11 times less return on investment than E L. But when comparing it to its historical volatility, Royal Bank of is 2.18 times less risky than E L. It trades about 0.23 of its potential returns per unit of risk. E L Financial Corp is currently generating about 0.22 of returns per unit of risk over similar time horizon. If you would invest  2,168  in E L Financial Corp on April 24, 2025 and sell it today you would earn a total of  144.00  from holding E L Financial Corp or generate 6.64% return on investment over 90 days.

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

Royal Bank of  vs.  E L Financial Corp

Royal Bank

Risk-Adjusted Performance

Solid

Compared to the overall equity markets, risk-adjusted returns on investments in Royal Bank of are ranked lower than 18 (%) of all global equities and portfolios over the last 90 days. In spite of comparatively stable basic indicators, Royal Bank is not utilizing all of its potentials. The current stock price uproar, may contribute to short-horizon losses for the private investors.

E L Financial

Risk-Adjusted Performance

Solid

Compared to the overall equity markets, risk-adjusted returns on investments in E L Financial Corp are ranked lower than 17 (%) of all global equities and portfolios over the last 90 days. Despite somewhat abnormal technical and fundamental indicators, E L may actually be approaching a critical reversion point that can send shares even higher in August 2025.

Pair Trading with Royal Bank and E L

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

The idea behind Royal Bank of and E L Financial Corp 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 Sync Your Broker module to sync your existing holdings, watchlists, positions or portfolios from thousands of online brokerage services, banks, investment account aggregators and robo-advisors..