Correlation Between Intelbras and Enjoei SA

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

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

Diversification Opportunities for Intelbras and Enjoei SA

0.77

Correlation Coefficient

Intelbras  Enjoei SA

Poor diversification

The 3 months correlation between Intelbras and Enjoei is 0.77. Overlapping area represents the amount of risk that can be diversified away by holding Intelbras SA and Enjoei SA in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Enjoei SA and Intelbras 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 Intelbras SA are associated (or correlated) with Enjoei SA. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Enjoei SA has no effect on the direction of Intelbras i.e., Intelbras and Enjoei SA go up and down completely randomly.

Pair Corralation between Intelbras and Enjoei SA

Assuming the 90 days trading horizon Intelbras SA is expected to generate 0.49 times more return on investment than Enjoei SA. However, Intelbras SA is 2.06 times less risky than Enjoei SA. It trades about -0.3 of its potential returns per unit of risk. Enjoei SA is currently generating about -0.15 per unit of risk. If you would invest  2,204  in Intelbras SA on August 30, 2024 and sell it today you would lose (602.00) from holding Intelbras SA or give up 27.31% of portfolio value over 90 days.

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

Intelbras SA   vs.  Enjoei SA

Intelbras SA

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Intelbras SA has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of uncertain performance in the last few months, the Stock's basic indicators remain comparatively stable which may send shares a bit higher in December 2024. The newest uproar may also be a sign of mid-term up-swing for the firm private investors.

Enjoei SA

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Enjoei SA has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of uncertain performance in the last few months, the Stock's basic indicators remain comparatively stable which may send shares a bit higher in December 2024. The newest uproar may also be a sign of mid-term up-swing for the firm private investors.

Pair Trading with Intelbras and Enjoei SA

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

The idea behind Intelbras SA and Enjoei 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 Funds Screener module to find actively-traded funds from around the world traded on over 30 global exchanges.