Correlation Between Enerpac Tool and JE Cleantech
Can any of the company-specific risk be diversified away by investing in both Enerpac Tool and JE Cleantech 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 JE Cleantech 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 JE Cleantech Holdings, you can compare the effects of market volatilities on Enerpac Tool and JE Cleantech 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 JE Cleantech. Check out your portfolio center. Please also check ongoing floating volatility patterns of Enerpac Tool and JE Cleantech.
Diversification Opportunities for Enerpac Tool and JE Cleantech
0.03 | Correlation Coefficient |
Significant diversification
The 3 months correlation between Enerpac and JCSE is 0.03. Overlapping area represents the amount of risk that can be diversified away by holding Enerpac Tool Group and JE Cleantech Holdings in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on JE Cleantech Holdings 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 JE Cleantech. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of JE Cleantech Holdings has no effect on the direction of Enerpac Tool i.e., Enerpac Tool and JE Cleantech go up and down completely randomly.
Pair Corralation between Enerpac Tool and JE Cleantech
Given the investment horizon of 90 days Enerpac Tool Group is expected to under-perform the JE Cleantech. But the stock apears to be less risky and, when comparing its historical volatility, Enerpac Tool Group is 8.95 times less risky than JE Cleantech. The stock trades about -0.01 of its potential returns per unit of risk. The JE Cleantech Holdings is currently generating about 0.16 of returns per unit of risk over similar time horizon. If you would invest 116.00 in JE Cleantech Holdings on September 14, 2024 and sell it today you would earn a total of 38.00 from holding JE Cleantech Holdings or generate 32.76% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Enerpac Tool Group vs. JE Cleantech Holdings
Performance |
| Timeline |
| Enerpac Tool Group |
| JE Cleantech Holdings |
Enerpac Tool and JE Cleantech Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Enerpac Tool and JE Cleantech
The main advantage of trading using opposite Enerpac Tool and JE Cleantech positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Enerpac Tool position performs unexpectedly, JE Cleantech 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 JE Cleantech will offset losses from the drop in JE Cleantech's long position.| Enerpac Tool vs. Omega Flex | Enerpac Tool vs. Luxfer Holdings PLC | Enerpac Tool vs. Gorman Rupp | Enerpac Tool vs. John Bean Technologies |
| JE Cleantech vs. Hurco Companies | JE Cleantech vs. Enerpac Tool Group | JE Cleantech vs. China Yuchai International | JE Cleantech vs. Luxfer Holdings PLC |
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 Stocks Directory module to find actively traded stocks across global markets.
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