Correlation Between ENB Financial and CCA Industries
Can any of the company-specific risk be diversified away by investing in both ENB Financial and CCA Industries 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 ENB Financial and CCA Industries into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between ENB Financial Corp and CCA Industries, you can compare the effects of market volatilities on ENB Financial and CCA Industries 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 ENB Financial with a short position of CCA Industries. Check out your portfolio center. Please also check ongoing floating volatility patterns of ENB Financial and CCA Industries.
Diversification Opportunities for ENB Financial and CCA Industries
-0.3 | Correlation Coefficient |
Very good diversification
The 3 months correlation between ENB and CCA is -0.3. Overlapping area represents the amount of risk that can be diversified away by holding ENB Financial Corp and CCA Industries in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on CCA Industries and ENB Financial 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 ENB Financial Corp are associated (or correlated) with CCA Industries. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of CCA Industries has no effect on the direction of ENB Financial i.e., ENB Financial and CCA Industries go up and down completely randomly.
Pair Corralation between ENB Financial and CCA Industries
Given the investment horizon of 90 days ENB Financial is expected to generate 10.77 times less return on investment than CCA Industries. But when comparing it to its historical volatility, ENB Financial Corp is 2.92 times less risky than CCA Industries. It trades about 0.02 of its potential returns per unit of risk. CCA Industries is currently generating about 0.08 of returns per unit of risk over similar time horizon. If you would invest 67.00 in CCA Industries on September 4, 2024 and sell it today you would earn a total of 10.00 from holding CCA Industries or generate 14.93% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 8.72% |
| Values | Daily Returns |
ENB Financial Corp vs. CCA Industries
Performance |
| Timeline |
| ENB Financial Corp |
| CCA Industries |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Very Weak
ENB Financial and CCA Industries Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with ENB Financial and CCA Industries
The main advantage of trading using opposite ENB Financial and CCA Industries positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if ENB Financial position performs unexpectedly, CCA Industries 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 CCA Industries will offset losses from the drop in CCA Industries' long position.| ENB Financial vs. Potomac Bancshares | ENB Financial vs. Apollo Bancorp | ENB Financial vs. The Farmers Bank | ENB Financial vs. 1ST SUMMIT BANCORP |
| CCA Industries vs. Firan Technology Group | CCA Industries vs. FitLife Brands, Common | CCA Industries vs. ENB Financial Corp | CCA Industries vs. Surge Components |
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 Portfolio Comparator module to compare the composition, asset allocations and performance of any two portfolios in your account.
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