Correlation Between Penta Ocean and Enter Air
Can any of the company-specific risk be diversified away by investing in both Penta Ocean and Enter Air 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 Penta Ocean and Enter Air into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Penta Ocean Construction Co and Enter Air SA, you can compare the effects of market volatilities on Penta Ocean and Enter Air 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 Penta Ocean with a short position of Enter Air. Check out your portfolio center. Please also check ongoing floating volatility patterns of Penta Ocean and Enter Air.
Diversification Opportunities for Penta Ocean and Enter Air
-0.29 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Penta and Enter is -0.29. Overlapping area represents the amount of risk that can be diversified away by holding Penta Ocean Construction Co and Enter Air SA in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Enter Air SA and Penta Ocean 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 Penta Ocean Construction Co are associated (or correlated) with Enter Air. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Enter Air SA has no effect on the direction of Penta Ocean i.e., Penta Ocean and Enter Air go up and down completely randomly.
Pair Corralation between Penta Ocean and Enter Air
Assuming the 90 days horizon Penta Ocean Construction Co is expected to under-perform the Enter Air. But the stock apears to be less risky and, when comparing its historical volatility, Penta Ocean Construction Co is 2.22 times less risky than Enter Air. The stock trades about -0.01 of its potential returns per unit of risk. The Enter Air SA is currently generating about 0.09 of returns per unit of risk over similar time horizon. If you would invest 321.00 in Enter Air SA on September 2, 2024 and sell it today you would earn a total of 891.00 from holding Enter Air SA or generate 277.57% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Penta Ocean Construction Co vs. Enter Air SA
Performance |
| Timeline |
| Penta Ocean Construc |
| Enter Air SA |
Penta Ocean and Enter Air Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Penta Ocean and Enter Air
The main advantage of trading using opposite Penta Ocean and Enter Air positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Penta Ocean position performs unexpectedly, Enter Air 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 Enter Air will offset losses from the drop in Enter Air's long position.| Penta Ocean vs. Transurban Group | Penta Ocean vs. Jiangsu Expressway | Penta Ocean vs. Zhejiang Expressway Co | Penta Ocean vs. Arcosa Inc |
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 Volatility Analysis module to get historical volatility and risk analysis based on latest market data.
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