Correlation Between Sapiens International and Enfusion
Can any of the company-specific risk be diversified away by investing in both Sapiens International and Enfusion 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 Sapiens International and Enfusion into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Sapiens International and Enfusion, you can compare the effects of market volatilities on Sapiens International and Enfusion 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 Sapiens International with a short position of Enfusion. Check out your portfolio center. Please also check ongoing floating volatility patterns of Sapiens International and Enfusion.
Diversification Opportunities for Sapiens International and Enfusion
-0.48 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Sapiens and Enfusion is -0.48. Overlapping area represents the amount of risk that can be diversified away by holding Sapiens International and Enfusion in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Enfusion and Sapiens International 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 Sapiens International are associated (or correlated) with Enfusion. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Enfusion has no effect on the direction of Sapiens International i.e., Sapiens International and Enfusion go up and down completely randomly.
Pair Corralation between Sapiens International and Enfusion
Given the investment horizon of 90 days Sapiens International is expected to under-perform the Enfusion. In addition to that, Sapiens International is 2.91 times more volatile than Enfusion. It trades about -0.21 of its total potential returns per unit of risk. Enfusion is currently generating about 0.23 per unit of volatility. If you would invest 916.00 in Enfusion on August 28, 2024 and sell it today you would earn a total of 90.00 from holding Enfusion or generate 9.83% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Sapiens International vs. Enfusion
Performance |
| Timeline |
| Sapiens International |
| Enfusion |
Sapiens International and Enfusion Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Sapiens International and Enfusion
The main advantage of trading using opposite Sapiens International and Enfusion positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Sapiens International position performs unexpectedly, Enfusion 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 Enfusion will offset losses from the drop in Enfusion's long position.| Sapiens International vs. PROS Holdings | Sapiens International vs. Meridianlink | Sapiens International vs. Enfusion | Sapiens International vs. PDF Solutions |
| Enfusion vs. ON24 Inc | Enfusion vs. Paycor HCM | Enfusion vs. E2open Parent Holdings | Enfusion vs. Braze 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 ETFs module to find actively traded Exchange Traded Funds (ETF) from around the world.
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