Correlation Between Home Depot and Endexx Corp
Can any of the company-specific risk be diversified away by investing in both Home Depot and Endexx Corp 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 Home Depot and Endexx Corp into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Home Depot and Endexx Corp, you can compare the effects of market volatilities on Home Depot and Endexx Corp 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 Home Depot with a short position of Endexx Corp. Check out your portfolio center. Please also check ongoing floating volatility patterns of Home Depot and Endexx Corp.
Diversification Opportunities for Home Depot and Endexx Corp
-0.78 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between Home and Endexx is -0.78. Overlapping area represents the amount of risk that can be diversified away by holding Home Depot and Endexx Corp in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Endexx Corp and Home Depot 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 Home Depot are associated (or correlated) with Endexx Corp. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Endexx Corp has no effect on the direction of Home Depot i.e., Home Depot and Endexx Corp go up and down completely randomly.
Pair Corralation between Home Depot and Endexx Corp
Allowing for the 90-day total investment horizon Home Depot is expected to generate 0.18 times more return on investment than Endexx Corp. However, Home Depot is 5.67 times less risky than Endexx Corp. It trades about 0.3 of its potential returns per unit of risk. Endexx Corp is currently generating about -0.02 per unit of risk. If you would invest 39,169 in Home Depot on September 1, 2024 and sell it today you would earn a total of 3,744 from holding Home Depot or generate 9.56% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Home Depot vs. Endexx Corp
Performance |
| Timeline |
| Home Depot |
| Endexx Corp |
Home Depot and Endexx Corp Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Home Depot and Endexx Corp
The main advantage of trading using opposite Home Depot and Endexx Corp positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Home Depot position performs unexpectedly, Endexx Corp 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 Endexx Corp will offset losses from the drop in Endexx Corp's long position.| Home Depot vs. Floor Decor Holdings | Home Depot vs. Arhaus Inc | Home Depot vs. Haverty Furniture Companies | Home Depot vs. Lowes Companies |
| Endexx Corp vs. Holloman Energy Corp | Endexx Corp vs. cbdMD Inc | Endexx Corp vs. Evolus Inc | Endexx Corp vs. CV Sciences |
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 Economic Indicators module to top statistical indicators that provide insights into how an economy is performing.
Other Complementary Tools
| Portfolio Analyzer Portfolio analysis module that provides access to portfolio diagnostics and optimization engine | |
| Stocks Directory Find actively traded stocks across global markets | |
| Funds Screener Find actively-traded funds from around the world traded on over 30 global exchanges | |
| Idea Analyzer Analyze all characteristics, volatility and risk-adjusted return of Macroaxis ideas | |
| Bollinger Bands Use Bollinger Bands indicator to analyze target price for a given investing horizon |