Correlation Between Hurco Companies and EON Resources

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

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

Diversification Opportunities for Hurco Companies and EON Resources

-0.39

Correlation Coefficient

Hurco Companies  EON Resources

Very good diversification

The 3 months correlation between Hurco and EON is -0.39. Overlapping area represents the amount of risk that can be diversified away by holding Hurco Companies and EON Resources in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on EON Resources and Hurco Companies 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 Hurco Companies are associated (or correlated) with EON Resources. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of EON Resources has no effect on the direction of Hurco Companies i.e., Hurco Companies and EON Resources go up and down completely randomly.

Pair Corralation between Hurco Companies and EON Resources

Given the investment horizon of 90 days Hurco Companies is expected to generate 0.36 times more return on investment than EON Resources. However, Hurco Companies is 2.81 times less risky than EON Resources. It trades about 0.24 of its potential returns per unit of risk. EON Resources is currently generating about -0.25 per unit of risk. If you would invest  2,082  in Hurco Companies on September 2, 2024 and sell it today you would earn a total of  250.00  from holding Hurco Companies or generate 12.01% return on investment over 90 days.

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

Hurco Companies  vs.  EON Resources

Hurco Companies

Risk-Adjusted Performance

13 of 100

Good

Compared to the overall equity markets, risk-adjusted returns on investments in Hurco Companies are ranked lower than 13 (%) of all global equities and portfolios over the last 90 days. In spite of rather unsteady basic indicators, Hurco Companies exhibited solid returns over the last few months and may actually be approaching a breakup point.

EON Resources

Risk-Adjusted Performance

0 of 100

Very Weak

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

Pair Trading with Hurco Companies and EON Resources

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

The idea behind Hurco Companies and EON Resources 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 Piotroski F Score module to get Piotroski F Score based on the binary analysis strategy of nine different fundamentals.