Correlation Between ENF Technology and KT Hitel

Can any of the company-specific risk be diversified away by investing in both ENF Technology and KT Hitel 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 ENF Technology and KT Hitel into the same portfolio, which is an essential part of the fundamental portfolio management process.

By analyzing existing cross correlation between ENF Technology Co and KT Hitel, you can compare the effects of market volatilities on ENF Technology and KT Hitel 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 ENF Technology with a short position of KT Hitel. Check out your portfolio center. Please also check ongoing floating volatility patterns of ENF Technology and KT Hitel.

Diversification Opportunities for ENF Technology and KT Hitel

-0.23

Correlation Coefficient

ENF Technology  KT Hitel

Very good diversification

The 3 months correlation between ENF and 036030 is -0.23. Overlapping area represents the amount of risk that can be diversified away by holding ENF Technology Co and KT Hitel in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on KT Hitel and ENF Technology 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 ENF Technology Co are associated (or correlated) with KT Hitel. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of KT Hitel has no effect on the direction of ENF Technology i.e., ENF Technology and KT Hitel go up and down completely randomly.

Pair Corralation between ENF Technology and KT Hitel

Assuming the 90 days trading horizon ENF Technology Co is expected to generate 1.18 times more return on investment than KT Hitel. However, ENF Technology is 1.18 times more volatile than KT Hitel. It trades about 0.0 of its potential returns per unit of risk. KT Hitel is currently generating about -0.06 per unit of risk. If you would invest  2,353,120  in ENF Technology Co on October 24, 2024 and sell it today you would lose (293,120) from holding ENF Technology Co or give up 12.46% of portfolio value over 90 days.

Time Period	3 Months [change]
Direction	Moves Against
Strength	Insignificant
Accuracy	99.79%
Values	Daily Returns

ENF Technology Co  vs.  KT Hitel

ENF Technology

Risk-Adjusted Performance

8 of 100

OK

Compared to the overall equity markets, risk-adjusted returns on investments in ENF Technology Co are ranked lower than 8 (%) of all global equities and portfolios over the last 90 days. Despite somewhat weak basic indicators, ENF Technology sustained solid returns over the last few months and may actually be approaching a breakup point.

KT Hitel

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days KT Hitel has generated negative risk-adjusted returns adding no value to investors with long positions. Despite weak performance in the last few months, the Stock's basic indicators remain somewhat strong which may send shares a bit higher in February 2025. The current disturbance may also be a sign of long term up-swing for the company investors.

Pair Trading with ENF Technology and KT Hitel

The main advantage of trading using opposite ENF Technology and KT Hitel positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if ENF Technology position performs unexpectedly, KT Hitel 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 KT Hitel will offset losses from the drop in KT Hitel's long position.

The idea behind ENF Technology Co and KT Hitel pairs trading is to make the combined position market-neutral, meaning the overall market's direction will not affect its win or loss (or potential downside or upside). This can be achieved by designing a pairs trade with two highly correlated stocks or equities that operate in a similar space or sector, making it possible to obtain profits through simple and relatively low-risk investment.

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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 Equity Analysis module to research over 250,000 global equities including funds, stocks and ETFs to find investment opportunities.