Correlation Between Embellence Group and Enad Global
Can any of the company-specific risk be diversified away by investing in both Embellence Group and Enad Global 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 Embellence Group and Enad Global into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Embellence Group AB and Enad Global 7, you can compare the effects of market volatilities on Embellence Group and Enad Global 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 Embellence Group with a short position of Enad Global. Check out your portfolio center. Please also check ongoing floating volatility patterns of Embellence Group and Enad Global.
Diversification Opportunities for Embellence Group and Enad Global
-0.35 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Embellence and Enad is -0.35. Overlapping area represents the amount of risk that can be diversified away by holding Embellence Group AB and Enad Global 7 in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Enad Global 7 and Embellence Group 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 Embellence Group AB are associated (or correlated) with Enad Global. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Enad Global 7 has no effect on the direction of Embellence Group i.e., Embellence Group and Enad Global go up and down completely randomly.
Pair Corralation between Embellence Group and Enad Global
Assuming the 90 days trading horizon Embellence Group is expected to generate 12.67 times less return on investment than Enad Global. But when comparing it to its historical volatility, Embellence Group AB is 1.66 times less risky than Enad Global. It trades about 0.0 of its potential returns per unit of risk. Enad Global 7 is currently generating about 0.0 of returns per unit of risk over similar time horizon. If you would invest 1,489 in Enad Global 7 on October 13, 2024 and sell it today you would lose (67.00) from holding Enad Global 7 or give up 4.5% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Embellence Group AB vs. Enad Global 7
Performance |
| Timeline |
| Embellence Group |
| Enad Global 7 |
Embellence Group and Enad Global Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Embellence Group and Enad Global
The main advantage of trading using opposite Embellence Group and Enad Global positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Embellence Group position performs unexpectedly, Enad Global 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 Enad Global will offset losses from the drop in Enad Global's long position.| Embellence Group vs. Rugvista Group AB | Embellence Group vs. Nimbus Group AB | Embellence Group vs. Desenio Group AB | Embellence Group vs. Idun Industrier AB |
| Enad Global vs. Stillfront Group AB | Enad Global vs. Embracer Group AB | Enad Global vs. G5 Entertainment publ | Enad Global vs. Sinch AB |
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 Equity Analysis module to research over 250,000 global equities including funds, stocks and ETFs to find investment opportunities.
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