Correlation Between Hugo Boss and ENEOS Holdings

Can any of the company-specific risk be diversified away by investing in both Hugo Boss and ENEOS Holdings 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 Hugo Boss and ENEOS Holdings into the same portfolio, which is an essential part of the fundamental portfolio management process.

By analyzing existing cross correlation between Hugo Boss AG and ENEOS Holdings, you can compare the effects of market volatilities on Hugo Boss and ENEOS Holdings 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 Hugo Boss with a short position of ENEOS Holdings. Check out your portfolio center. Please also check ongoing floating volatility patterns of Hugo Boss and ENEOS Holdings.

Diversification Opportunities for Hugo Boss and ENEOS Holdings

-0.37

Correlation Coefficient

Hugo Boss  ENEOS Holdings

Very good diversification

The 3 months correlation between Hugo and ENEOS is -0.37. Overlapping area represents the amount of risk that can be diversified away by holding Hugo Boss AG and ENEOS Holdings in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on ENEOS Holdings and Hugo Boss 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 Hugo Boss AG are associated (or correlated) with ENEOS Holdings. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of ENEOS Holdings has no effect on the direction of Hugo Boss i.e., Hugo Boss and ENEOS Holdings go up and down completely randomly.

Pair Corralation between Hugo Boss and ENEOS Holdings

Assuming the 90 days trading horizon Hugo Boss AG is expected to under-perform the ENEOS Holdings. In addition to that, Hugo Boss is 1.07 times more volatile than ENEOS Holdings. It trades about -0.14 of its total potential returns per unit of risk. ENEOS Holdings is currently generating about 0.06 per unit of volatility. If you would invest  488.00  in ENEOS Holdings on December 29, 2024 and sell it today you would earn a total of  32.00  from holding ENEOS Holdings or generate 6.56% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Against
Strength	Insignificant
Accuracy	98.44%
Values	Daily Returns

Hugo Boss AG  vs.  ENEOS Holdings

Hugo Boss AG

Risk-Adjusted Performance

Very Weak

Over the last 90 days Hugo Boss AG has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of fragile performance in the last few months, the Stock's basic indicators remain rather sound which may send shares a bit higher in April 2025. The latest tumult may also be a sign of longer-term up-swing for the firm shareholders.

ENEOS Holdings

Risk-Adjusted Performance

Insignificant

Compared to the overall equity markets, risk-adjusted returns on investments in ENEOS Holdings are ranked lower than 4 (%) of all global equities and portfolios over the last 90 days. Despite nearly fragile basic indicators, ENEOS Holdings may actually be approaching a critical reversion point that can send shares even higher in April 2025.

Pair Trading with Hugo Boss and ENEOS Holdings

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

The idea behind Hugo Boss AG and ENEOS Holdings 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 Portfolio Backtesting module to avoid under-diversification and over-optimization by backtesting your portfolios.