Correlation Between Global E and Ensurge Micropower
Can any of the company-specific risk be diversified away by investing in both Global E and Ensurge Micropower 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 Global E and Ensurge Micropower into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Global E Online and Ensurge Micropower ASA, you can compare the effects of market volatilities on Global E and Ensurge Micropower 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 Global E with a short position of Ensurge Micropower. Check out your portfolio center. Please also check ongoing floating volatility patterns of Global E and Ensurge Micropower.
Diversification Opportunities for Global E and Ensurge Micropower
-0.67 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between Global and Ensurge is -0.67. Overlapping area represents the amount of risk that can be diversified away by holding Global E Online and Ensurge Micropower ASA in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Ensurge Micropower ASA and Global E 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 Global E Online are associated (or correlated) with Ensurge Micropower. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Ensurge Micropower ASA has no effect on the direction of Global E i.e., Global E and Ensurge Micropower go up and down completely randomly.
Pair Corralation between Global E and Ensurge Micropower
Given the investment horizon of 90 days Global E is expected to generate 78.6 times less return on investment than Ensurge Micropower. But when comparing it to its historical volatility, Global E Online is 30.8 times less risky than Ensurge Micropower. It trades about 0.08 of its potential returns per unit of risk. Ensurge Micropower ASA is currently generating about 0.21 of returns per unit of risk over similar time horizon. If you would invest 404.00 in Ensurge Micropower ASA on September 13, 2024 and sell it today you would lose (375.00) from holding Ensurge Micropower ASA or give up 92.82% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 76.77% |
| Values | Daily Returns |
Global E Online vs. Ensurge Micropower ASA
Performance |
| Timeline |
| Global E Online |
| Ensurge Micropower ASA |
Global E and Ensurge Micropower Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Global E and Ensurge Micropower
The main advantage of trading using opposite Global E and Ensurge Micropower positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Global E position performs unexpectedly, Ensurge Micropower 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 Ensurge Micropower will offset losses from the drop in Ensurge Micropower's long position.| Global E vs. MercadoLibre | Global E vs. PDD Holdings | Global E vs. JD Inc Adr | Global E vs. Alibaba Group Holding |
| Ensurge Micropower vs. Ensurge Micropower ASA | Ensurge Micropower vs. AAC Clyde Space | Ensurge Micropower vs. Ynvisible Interactive | Ensurge Micropower vs. World Technology Corp |
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 Instant Ratings module to determine any equity ratings based on digital recommendations. Macroaxis instant equity ratings are based on combination of fundamental analysis and risk-adjusted market performance.
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