Correlation Between Enova International and Old Market
Can any of the company-specific risk be diversified away by investing in both Enova International and Old Market 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 Enova International and Old Market into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Enova International and Old Market Capital, you can compare the effects of market volatilities on Enova International and Old Market 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 Enova International with a short position of Old Market. Check out your portfolio center. Please also check ongoing floating volatility patterns of Enova International and Old Market.
Diversification Opportunities for Enova International and Old Market
-0.37 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Enova and Old is -0.37. Overlapping area represents the amount of risk that can be diversified away by holding Enova International and Old Market Capital in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Old Market Capital and Enova International 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 Enova International are associated (or correlated) with Old Market. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Old Market Capital has no effect on the direction of Enova International i.e., Enova International and Old Market go up and down completely randomly.
Pair Corralation between Enova International and Old Market
Given the investment horizon of 90 days Enova International is expected to generate 1.7 times more return on investment than Old Market. However, Enova International is 1.7 times more volatile than Old Market Capital. It trades about 0.29 of its potential returns per unit of risk. Old Market Capital is currently generating about -0.08 per unit of risk. If you would invest 8,817 in Enova International on August 24, 2024 and sell it today you would earn a total of 1,657 from holding Enova International or generate 18.79% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 95.65% |
| Values | Daily Returns |
Enova International vs. Old Market Capital
Performance |
| Timeline |
| Enova International |
| Old Market Capital |
Enova International and Old Market Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Enova International and Old Market
The main advantage of trading using opposite Enova International and Old Market positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Enova International position performs unexpectedly, Old Market 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 Old Market will offset losses from the drop in Old Market's long position.| Enova International vs. Regional Management Corp | Enova International vs. Encore Capital Group | Enova International vs. Customers Bancorp | Enova International vs. Employers Holdings |
| Old Market vs. Synchrony Financial | Old Market vs. Enova International | Old Market vs. EZCORP Inc | Old Market vs. World Acceptance |
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 Global Markets Map module to get a quick overview of global market snapshot using zoomable world map. Drill down to check world indexes.
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