Correlation Between Enerpac Tool and Agfa-Gevaert
Can any of the company-specific risk be diversified away by investing in both Enerpac Tool and Agfa-Gevaert 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 Enerpac Tool and Agfa-Gevaert into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Enerpac Tool Group and Agfa Gevaert NV, you can compare the effects of market volatilities on Enerpac Tool and Agfa-Gevaert 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 Enerpac Tool with a short position of Agfa-Gevaert. Check out your portfolio center. Please also check ongoing floating volatility patterns of Enerpac Tool and Agfa-Gevaert.
Diversification Opportunities for Enerpac Tool and Agfa-Gevaert
-0.65 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between Enerpac and Agfa-Gevaert is -0.65. Overlapping area represents the amount of risk that can be diversified away by holding Enerpac Tool Group and Agfa Gevaert NV in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Agfa Gevaert NV and Enerpac Tool 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 Enerpac Tool Group are associated (or correlated) with Agfa-Gevaert. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Agfa Gevaert NV has no effect on the direction of Enerpac Tool i.e., Enerpac Tool and Agfa-Gevaert go up and down completely randomly.
Pair Corralation between Enerpac Tool and Agfa-Gevaert
Given the investment horizon of 90 days Enerpac Tool Group is expected to generate 0.48 times more return on investment than Agfa-Gevaert. However, Enerpac Tool Group is 2.08 times less risky than Agfa-Gevaert. It trades about 0.12 of its potential returns per unit of risk. Agfa Gevaert NV is currently generating about -0.1 per unit of risk. If you would invest 3,753 in Enerpac Tool Group on September 3, 2024 and sell it today you would earn a total of 1,073 from holding Enerpac Tool Group or generate 28.59% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Enerpac Tool Group vs. Agfa Gevaert NV
Performance |
| Timeline |
| Enerpac Tool Group |
| Agfa Gevaert NV |
Enerpac Tool and Agfa-Gevaert Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Enerpac Tool and Agfa-Gevaert
The main advantage of trading using opposite Enerpac Tool and Agfa-Gevaert positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Enerpac Tool position performs unexpectedly, Agfa-Gevaert 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 Agfa-Gevaert will offset losses from the drop in Agfa-Gevaert's long position.| Enerpac Tool vs. Parker Hannifin | Enerpac Tool vs. SPACE | Enerpac Tool vs. Bayview Acquisition Corp | Enerpac Tool vs. T Rowe Price |
| Agfa-Gevaert vs. Enerpac Tool Group | Agfa-Gevaert vs. Omega Flex | Agfa-Gevaert vs. Luxfer Holdings PLC | Agfa-Gevaert vs. Gorman Rupp |
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 Headlines Timeline module to stay connected to all market stories and filter out noise. Drill down to analyze hype elasticity.
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