Correlation Between Gfl Environmental and Enphase Energy
Can any of the company-specific risk be diversified away by investing in both Gfl Environmental and Enphase Energy 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 Gfl Environmental and Enphase Energy into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Gfl Environmental Holdings and Enphase Energy, you can compare the effects of market volatilities on Gfl Environmental and Enphase Energy 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 Gfl Environmental with a short position of Enphase Energy. Check out your portfolio center. Please also check ongoing floating volatility patterns of Gfl Environmental and Enphase Energy.
Diversification Opportunities for Gfl Environmental and Enphase Energy
-0.64 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between Gfl and Enphase is -0.64. Overlapping area represents the amount of risk that can be diversified away by holding Gfl Environmental Holdings and Enphase Energy in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Enphase Energy and Gfl Environmental 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 Gfl Environmental Holdings are associated (or correlated) with Enphase Energy. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Enphase Energy has no effect on the direction of Gfl Environmental i.e., Gfl Environmental and Enphase Energy go up and down completely randomly.
Pair Corralation between Gfl Environmental and Enphase Energy
Considering the 90-day investment horizon Gfl Environmental Holdings is expected to generate 0.38 times more return on investment than Enphase Energy. However, Gfl Environmental Holdings is 2.66 times less risky than Enphase Energy. It trades about 0.23 of its potential returns per unit of risk. Enphase Energy is currently generating about -0.16 per unit of risk. If you would invest 4,169 in Gfl Environmental Holdings on August 24, 2024 and sell it today you would earn a total of 408.00 from holding Gfl Environmental Holdings or generate 9.79% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Gfl Environmental Holdings vs. Enphase Energy
Performance |
| Timeline |
| Gfl Environmental |
| Enphase Energy |
Gfl Environmental and Enphase Energy Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Gfl Environmental and Enphase Energy
The main advantage of trading using opposite Gfl Environmental and Enphase Energy positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Gfl Environmental position performs unexpectedly, Enphase Energy 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 Enphase Energy will offset losses from the drop in Enphase Energy's long position.| Gfl Environmental vs. Pro Dex | Gfl Environmental vs. Pure Cycle | Gfl Environmental vs. Quest Resource Holding | Gfl Environmental vs. ABIVAX Socit Anonyme |
| Enphase Energy vs. Small Cap Core | Enphase Energy vs. Freedom Holding Corp | Enphase Energy vs. Gfl Environmental Holdings | Enphase Energy vs. Growth Fund Of |
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 Price Ceiling Movement module to calculate and plot Price Ceiling Movement for different equity instruments.
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