Correlation Between ENF Technology and NH Investment
Can any of the company-specific risk be diversified away by investing in both ENF Technology and NH Investment 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 ENF Technology and NH Investment into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between ENF Technology Co and NH Investment Securities, you can compare the effects of market volatilities on ENF Technology and NH Investment 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 ENF Technology with a short position of NH Investment. Check out your portfolio center. Please also check ongoing floating volatility patterns of ENF Technology and NH Investment.
Diversification Opportunities for ENF Technology and NH Investment
0.12 | Correlation Coefficient |
Average diversification
The 3 months correlation between ENF and 005940 is 0.12. Overlapping area represents the amount of risk that can be diversified away by holding ENF Technology Co and NH Investment Securities in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on NH Investment Securities and ENF Technology 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 ENF Technology Co are associated (or correlated) with NH Investment. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of NH Investment Securities has no effect on the direction of ENF Technology i.e., ENF Technology and NH Investment go up and down completely randomly.
Pair Corralation between ENF Technology and NH Investment
Assuming the 90 days trading horizon ENF Technology Co is expected to generate 2.56 times more return on investment than NH Investment. However, ENF Technology is 2.56 times more volatile than NH Investment Securities. It trades about 0.35 of its potential returns per unit of risk. NH Investment Securities is currently generating about -0.03 per unit of risk. If you would invest 1,625,076 in ENF Technology Co on October 11, 2024 and sell it today you would earn a total of 434,924 from holding ENF Technology Co or generate 26.76% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 95.0% |
| Values | Daily Returns |
ENF Technology Co vs. NH Investment Securities
Performance |
| Timeline |
| ENF Technology |
| NH Investment Securities |
ENF Technology and NH Investment Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with ENF Technology and NH Investment
The main advantage of trading using opposite ENF Technology and NH Investment positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if ENF Technology position performs unexpectedly, NH Investment 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 NH Investment will offset losses from the drop in NH Investment's long position.| ENF Technology vs. Dongjin Semichem Co | ENF Technology vs. SS TECH | ENF Technology vs. Tokai Carbon Korea | ENF Technology vs. Soulbrain Holdings Co |
| NH Investment vs. Duksan Hi Metal | NH Investment vs. Mirai Semiconductors Co | NH Investment vs. Dongil Metal Co | NH Investment vs. Hanjoo Light Metal |
Check out your portfolio center.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 Pattern Recognition module to use different Pattern Recognition models to time the market across multiple global exchanges.
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