Correlation Between ENN Energy and Rubis SCA
Can any of the company-specific risk be diversified away by investing in both ENN Energy and Rubis SCA 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 ENN Energy and Rubis SCA into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between ENN Energy Holdings and Rubis SCA, you can compare the effects of market volatilities on ENN Energy and Rubis SCA 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 ENN Energy with a short position of Rubis SCA. Check out your portfolio center. Please also check ongoing floating volatility patterns of ENN Energy and Rubis SCA.
Diversification Opportunities for ENN Energy and Rubis SCA
-0.34 | Correlation Coefficient |
Very good diversification
The 3 months correlation between ENN and Rubis is -0.34. Overlapping area represents the amount of risk that can be diversified away by holding ENN Energy Holdings and Rubis SCA in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Rubis SCA and ENN Energy 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 ENN Energy Holdings are associated (or correlated) with Rubis SCA. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Rubis SCA has no effect on the direction of ENN Energy i.e., ENN Energy and Rubis SCA go up and down completely randomly.
Pair Corralation between ENN Energy and Rubis SCA
Assuming the 90 days trading horizon ENN Energy Holdings is expected to generate 1.73 times more return on investment than Rubis SCA. However, ENN Energy is 1.73 times more volatile than Rubis SCA. It trades about 0.14 of its potential returns per unit of risk. Rubis SCA is currently generating about 0.0 per unit of risk. If you would invest 501.00 in ENN Energy Holdings on September 22, 2024 and sell it today you would earn a total of 164.00 from holding ENN Energy Holdings or generate 32.73% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 98.48% |
| Values | Daily Returns |
ENN Energy Holdings vs. Rubis SCA
Performance |
| Timeline |
| ENN Energy Holdings |
| Rubis SCA |
ENN Energy and Rubis SCA Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with ENN Energy and Rubis SCA
The main advantage of trading using opposite ENN Energy and Rubis SCA positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if ENN Energy position performs unexpectedly, Rubis SCA 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 Rubis SCA will offset losses from the drop in Rubis SCA's long position.| ENN Energy vs. Naturgy Energy Group | ENN Energy vs. CenterPoint Energy | ENN Energy vs. Snam SpA | ENN Energy vs. Atmos Energy |
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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 Cryptocurrency Center module to build and monitor diversified portfolio of extremely risky digital assets and cryptocurrency.
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