Correlation Between Enerpac Tool and Schneider Electric
Can any of the company-specific risk be diversified away by investing in both Enerpac Tool and Schneider Electric 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 Schneider Electric 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 Schneider Electric SE, you can compare the effects of market volatilities on Enerpac Tool and Schneider Electric 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 Schneider Electric. Check out your portfolio center. Please also check ongoing floating volatility patterns of Enerpac Tool and Schneider Electric.
Diversification Opportunities for Enerpac Tool and Schneider Electric
0.02 | Correlation Coefficient |
Significant diversification
The 3 months correlation between Enerpac and Schneider is 0.02. Overlapping area represents the amount of risk that can be diversified away by holding Enerpac Tool Group and Schneider Electric SE in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Schneider Electric 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 Schneider Electric. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Schneider Electric has no effect on the direction of Enerpac Tool i.e., Enerpac Tool and Schneider Electric go up and down completely randomly.
Pair Corralation between Enerpac Tool and Schneider Electric
Given the investment horizon of 90 days Enerpac Tool Group is expected to generate 1.02 times more return on investment than Schneider Electric. However, Enerpac Tool is 1.02 times more volatile than Schneider Electric SE. It trades about 0.18 of its potential returns per unit of risk. Schneider Electric SE is currently generating about -0.01 per unit of risk. If you would invest 4,412 in Enerpac Tool Group on September 1, 2024 and sell it today you would earn a total of 414.00 from holding Enerpac Tool Group or generate 9.38% 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. Schneider Electric SE
Performance |
| Timeline |
| Enerpac Tool Group |
| Schneider Electric |
Enerpac Tool and Schneider Electric Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Enerpac Tool and Schneider Electric
The main advantage of trading using opposite Enerpac Tool and Schneider Electric positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Enerpac Tool position performs unexpectedly, Schneider Electric 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 Schneider Electric will offset losses from the drop in Schneider Electric's long position.| Enerpac Tool vs. Flowserve | Enerpac Tool vs. Dover | Enerpac Tool vs. Crane Company | Enerpac Tool vs. Graco Inc |
| Schneider Electric vs. GE Aerospace | Schneider Electric vs. Eaton PLC | Schneider Electric vs. Siemens AG Class | Schneider Electric vs. Parker Hannifin |
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 Premium Stories module to follow Macroaxis premium stories from verified contributors across different equity types, categories and coverage scope.
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