Correlation Between Eldorado Gold and Enersys
Can any of the company-specific risk be diversified away by investing in both Eldorado Gold and Enersys 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 Eldorado Gold and Enersys into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Eldorado Gold Corp and Enersys, you can compare the effects of market volatilities on Eldorado Gold and Enersys 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 Eldorado Gold with a short position of Enersys. Check out your portfolio center. Please also check ongoing floating volatility patterns of Eldorado Gold and Enersys.
Diversification Opportunities for Eldorado Gold and Enersys
0.44 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Eldorado and Enersys is 0.44. Overlapping area represents the amount of risk that can be diversified away by holding Eldorado Gold Corp and Enersys in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Enersys and Eldorado Gold 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 Eldorado Gold Corp are associated (or correlated) with Enersys. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Enersys has no effect on the direction of Eldorado Gold i.e., Eldorado Gold and Enersys go up and down completely randomly.
Pair Corralation between Eldorado Gold and Enersys
Considering the 90-day investment horizon Eldorado Gold Corp is expected to under-perform the Enersys. In addition to that, Eldorado Gold is 1.49 times more volatile than Enersys. It trades about -0.11 of its total potential returns per unit of risk. Enersys is currently generating about -0.02 per unit of volatility. If you would invest 9,867 in Enersys on August 25, 2024 and sell it today you would lose (115.00) from holding Enersys or give up 1.17% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Eldorado Gold Corp vs. Enersys
Performance |
| Timeline |
| Eldorado Gold Corp |
| Enersys |
Eldorado Gold and Enersys Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Eldorado Gold and Enersys
The main advantage of trading using opposite Eldorado Gold and Enersys positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Eldorado Gold position performs unexpectedly, Enersys 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 Enersys will offset losses from the drop in Enersys' long position.| Eldorado Gold vs. IAMGold | Eldorado Gold vs. Kinross Gold | Eldorado Gold vs. Agnico Eagle Mines | Eldorado Gold vs. Gold Fields Ltd |
| Enersys vs. Advanced Energy Industries | Enersys vs. Hubbell | Enersys vs. Acuity Brands | Enersys vs. Kimball Electronics |
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 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..
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