Correlation Between Trex and Antelope Enterprise
Can any of the company-specific risk be diversified away by investing in both Trex and Antelope Enterprise 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 Trex and Antelope Enterprise into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Trex Company and Antelope Enterprise Holdings, you can compare the effects of market volatilities on Trex and Antelope Enterprise 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 Trex with a short position of Antelope Enterprise. Check out your portfolio center. Please also check ongoing floating volatility patterns of Trex and Antelope Enterprise.
Diversification Opportunities for Trex and Antelope Enterprise
-0.58 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between Trex and Antelope is -0.58. Overlapping area represents the amount of risk that can be diversified away by holding Trex Company and Antelope Enterprise Holdings in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Antelope Enterprise and Trex 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 Trex Company are associated (or correlated) with Antelope Enterprise. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Antelope Enterprise has no effect on the direction of Trex i.e., Trex and Antelope Enterprise go up and down completely randomly.
Pair Corralation between Trex and Antelope Enterprise
Given the investment horizon of 90 days Trex Company is expected to generate 0.36 times more return on investment than Antelope Enterprise. However, Trex Company is 2.78 times less risky than Antelope Enterprise. It trades about 0.29 of its potential returns per unit of risk. Antelope Enterprise Holdings is currently generating about -0.24 per unit of risk. If you would invest 6,651 in Trex Company on August 28, 2024 and sell it today you would earn a total of 1,059 from holding Trex Company or generate 15.92% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Trex Company vs. Antelope Enterprise Holdings
Performance |
| Timeline |
| Trex Company |
| Antelope Enterprise |
Trex and Antelope Enterprise Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Trex and Antelope Enterprise
The main advantage of trading using opposite Trex and Antelope Enterprise positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Trex position performs unexpectedly, Antelope Enterprise 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 Antelope Enterprise will offset losses from the drop in Antelope Enterprise's long position.| Trex vs. Quanex Building Products | Trex vs. Armstrong World Industries | Trex vs. Gibraltar Industries | Trex vs. Apogee Enterprises |
| Antelope Enterprise vs. Azek Company | Antelope Enterprise vs. AAON Inc | Antelope Enterprise vs. GMS Inc | Antelope Enterprise vs. Intelligent Living Application |
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 Stock Screener module to find equities using a custom stock filter or screen asymmetry in trading patterns, price, volume, or investment outlook..
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