Correlation Between Enphase Energy, and FibroGen
Can any of the company-specific risk be diversified away by investing in both Enphase Energy, and FibroGen 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 Enphase Energy, and FibroGen into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Enphase Energy, and FibroGen, you can compare the effects of market volatilities on Enphase Energy, and FibroGen 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 Enphase Energy, with a short position of FibroGen. Check out your portfolio center. Please also check ongoing floating volatility patterns of Enphase Energy, and FibroGen.
Diversification Opportunities for Enphase Energy, and FibroGen
0.47 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Enphase and FibroGen is 0.47. Overlapping area represents the amount of risk that can be diversified away by holding Enphase Energy, and FibroGen in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on FibroGen and Enphase Energy, 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 Enphase Energy, are associated (or correlated) with FibroGen. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of FibroGen has no effect on the direction of Enphase Energy, i.e., Enphase Energy, and FibroGen go up and down completely randomly.
Pair Corralation between Enphase Energy, and FibroGen
Assuming the 90 days trading horizon Enphase Energy, is expected to under-perform the FibroGen. But the stock apears to be less risky and, when comparing its historical volatility, Enphase Energy, is 1.15 times less risky than FibroGen. The stock trades about -0.17 of its potential returns per unit of risk. The FibroGen is currently generating about 0.05 of returns per unit of risk over similar time horizon. If you would invest 750.00 in FibroGen on August 30, 2024 and sell it today you would earn a total of 40.00 from holding FibroGen or generate 5.33% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Enphase Energy, vs. FibroGen
Performance |
| Timeline |
| Enphase Energy, |
| FibroGen |
Enphase Energy, and FibroGen Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Enphase Energy, and FibroGen
The main advantage of trading using opposite Enphase Energy, and FibroGen positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Enphase Energy, position performs unexpectedly, FibroGen 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 FibroGen will offset losses from the drop in FibroGen's long position.| Enphase Energy, vs. Capital One Financial | Enphase Energy, vs. Micron Technology | Enphase Energy, vs. First Republic Bank | Enphase Energy, vs. The Bank of |
| FibroGen vs. UnitedHealth Group Incorporated | FibroGen vs. Grupo Sports World | FibroGen vs. Taiwan Semiconductor Manufacturing | FibroGen vs. DXC Technology |
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 Forecasting module to use basic forecasting models to generate price predictions and determine price momentum.
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