Correlation Between Enovix Corp and Hubbell
Can any of the company-specific risk be diversified away by investing in both Enovix Corp and Hubbell 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 Enovix Corp and Hubbell into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Enovix Corp and Hubbell, you can compare the effects of market volatilities on Enovix Corp and Hubbell 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 Enovix Corp with a short position of Hubbell. Check out your portfolio center. Please also check ongoing floating volatility patterns of Enovix Corp and Hubbell.
Diversification Opportunities for Enovix Corp and Hubbell
-0.21 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Enovix and Hubbell is -0.21. Overlapping area represents the amount of risk that can be diversified away by holding Enovix Corp and Hubbell in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Hubbell and Enovix Corp 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 Enovix Corp are associated (or correlated) with Hubbell. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Hubbell has no effect on the direction of Enovix Corp i.e., Enovix Corp and Hubbell go up and down completely randomly.
Pair Corralation between Enovix Corp and Hubbell
Given the investment horizon of 90 days Enovix Corp is expected to generate 4.87 times more return on investment than Hubbell. However, Enovix Corp is 4.87 times more volatile than Hubbell. It trades about 0.08 of its potential returns per unit of risk. Hubbell is currently generating about 0.11 per unit of risk. If you would invest 1,001 in Enovix Corp on October 22, 2024 and sell it today you would earn a total of 71.00 from holding Enovix Corp or generate 7.09% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Enovix Corp vs. Hubbell
Performance |
| Timeline |
| Enovix Corp |
| Hubbell |
Enovix Corp and Hubbell Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Enovix Corp and Hubbell
The main advantage of trading using opposite Enovix Corp and Hubbell positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Enovix Corp position performs unexpectedly, Hubbell 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 Hubbell will offset losses from the drop in Hubbell's long position.| Enovix Corp vs. ESS Tech | Enovix Corp vs. FREYR Battery SA | Enovix Corp vs. Microvast Holdings | Enovix Corp vs. Eos Energy Enterprises |
| Hubbell vs. Advanced Energy Industries | Hubbell vs. Enersys | Hubbell vs. Acuity Brands | Hubbell 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 Portfolio Rebalancing module to analyze risk-adjusted returns against different time horizons to find asset-allocation targets.
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