Correlation Between Enogia SAS and Stradim Espace

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Can any of the company-specific risk be diversified away by investing in both Enogia SAS and Stradim Espace 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 Enogia SAS and Stradim Espace into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Enogia SAS and Stradim Espace Finances, you can compare the effects of market volatilities on Enogia SAS and Stradim Espace 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 Enogia SAS with a short position of Stradim Espace. Check out your portfolio center. Please also check ongoing floating volatility patterns of Enogia SAS and Stradim Espace.

Diversification Opportunities for Enogia SAS and Stradim Espace

0.23
  Correlation Coefficient

Modest diversification

The 3 months correlation between Enogia and Stradim is 0.23. Overlapping area represents the amount of risk that can be diversified away by holding Enogia SAS and Stradim Espace Finances in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Stradim Espace Finances and Enogia SAS 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 Enogia SAS are associated (or correlated) with Stradim Espace. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Stradim Espace Finances has no effect on the direction of Enogia SAS i.e., Enogia SAS and Stradim Espace go up and down completely randomly.

Pair Corralation between Enogia SAS and Stradim Espace

Assuming the 90 days trading horizon Enogia SAS is expected to under-perform the Stradim Espace. But the stock apears to be less risky and, when comparing its historical volatility, Enogia SAS is 2.3 times less risky than Stradim Espace. The stock trades about -0.23 of its potential returns per unit of risk. The Stradim Espace Finances is currently generating about 0.0 of returns per unit of risk over similar time horizon. If you would invest  600.00  in Stradim Espace Finances on September 4, 2024 and sell it today you would lose (50.00) from holding Stradim Espace Finances or give up 8.33% of portfolio value over 90 days.
Time Period3 Months [change]
DirectionMoves Together 
StrengthVery Weak
Accuracy98.46%
ValuesDaily Returns

Enogia SAS  vs.  Stradim Espace Finances

 Performance 
       Timeline  
Enogia SAS 

Risk-Adjusted Performance

0 of 100

 
Weak
 
Strong
Very Weak
Over the last 90 days Enogia SAS has generated negative risk-adjusted returns adding no value to investors with long positions. Even with weak performance in the last few months, the Stock's basic indicators remain relatively invariable which may send shares a bit higher in January 2025. The latest agitation may also be a sign of long-running up-swing for the enterprise retail investors.
Stradim Espace Finances 

Risk-Adjusted Performance

0 of 100

 
Weak
 
Strong
Weak
Over the last 90 days Stradim Espace Finances has generated negative risk-adjusted returns adding no value to investors with long positions. Even with relatively invariable basic indicators, Stradim Espace is not utilizing all of its potentials. The current stock price agitation, may contribute to short-term losses for the retail investors.

Enogia SAS and Stradim Espace Volatility Contrast

   Predicted Return Density   
       Returns  

Pair Trading with Enogia SAS and Stradim Espace

The main advantage of trading using opposite Enogia SAS and Stradim Espace positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Enogia SAS position performs unexpectedly, Stradim Espace 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 Stradim Espace will offset losses from the drop in Stradim Espace's long position.
The idea behind Enogia SAS and Stradim Espace Finances 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 AI Portfolio Architect module to use AI to generate optimal portfolios and find profitable investment opportunities.

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