Correlation Between Pekin Life and Enersys
Can any of the company-specific risk be diversified away by investing in both Pekin Life and Enersys 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 Pekin Life and Enersys into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Pekin Life Insurance and Enersys, you can compare the effects of market volatilities on Pekin Life and Enersys 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 Pekin Life with a short position of Enersys. Check out your portfolio center. Please also check ongoing floating volatility patterns of Pekin Life and Enersys.
Diversification Opportunities for Pekin Life and Enersys
-0.42 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Pekin and Enersys is -0.42. Overlapping area represents the amount of risk that can be diversified away by holding Pekin Life Insurance and Enersys in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Enersys and Pekin Life 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 Pekin Life Insurance are associated (or correlated) with Enersys. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Enersys has no effect on the direction of Pekin Life i.e., Pekin Life and Enersys go up and down completely randomly.
Pair Corralation between Pekin Life and Enersys
Given the investment horizon of 90 days Pekin Life Insurance is expected to generate 0.21 times more return on investment than Enersys. However, Pekin Life Insurance is 4.67 times less risky than Enersys. It trades about 0.22 of its potential returns per unit of risk. Enersys is currently generating about -0.01 per unit of risk. If you would invest 1,152 in Pekin Life Insurance on September 3, 2024 and sell it today you would earn a total of 23.00 from holding Pekin Life Insurance or generate 2.0% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Pekin Life Insurance vs. Enersys
Performance |
| Timeline |
| Pekin Life Insurance |
| Enersys |
Pekin Life and Enersys Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Pekin Life and Enersys
The main advantage of trading using opposite Pekin Life and Enersys positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Pekin Life position performs unexpectedly, Enersys 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 Enersys will offset losses from the drop in Enersys' long position.| Pekin Life vs. FG Annuities Life | Pekin Life vs. MetLife Preferred Stock | Pekin Life vs. Brighthouse Financial | Pekin Life vs. MetLife Preferred Stock |
| Enersys vs. Advanced Energy Industries | Enersys vs. Hubbell | Enersys vs. Acuity Brands | Enersys vs. Kimball Electronics |
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 Analyst Advice module to analyst recommendations and target price estimates broken down by several categories.
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