Correlation Between CWC Energy and ENB Financial

Can any of the company-specific risk be diversified away by investing in both CWC Energy and ENB Financial 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 CWC Energy and ENB Financial into the same portfolio, which is an essential part of the fundamental portfolio management process.

By analyzing existing cross correlation between CWC Energy Services and ENB Financial Corp, you can compare the effects of market volatilities on CWC Energy and ENB Financial 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 CWC Energy with a short position of ENB Financial. Check out your portfolio center. Please also check ongoing floating volatility patterns of CWC Energy and ENB Financial.

Diversification Opportunities for CWC Energy and ENB Financial

0.0

Correlation Coefficient

CWC Energy  ENB Financial

Pay attention - limited upside

The 3 months correlation between CWC and ENB is 0.0. Overlapping area represents the amount of risk that can be diversified away by holding CWC Energy Services and ENB Financial Corp in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on ENB Financial Corp and CWC 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 CWC Energy Services are associated (or correlated) with ENB Financial. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of ENB Financial Corp has no effect on the direction of CWC Energy i.e., CWC Energy and ENB Financial go up and down completely randomly.

Pair Corralation between CWC Energy and ENB Financial

If you would invest (100.00) in CWC Energy Services on December 26, 2024 and sell it today you would earn a total of  100.00  from holding CWC Energy Services or generate -100.0% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Flat
Strength	Insignificant
Accuracy	0.0%
Values	Daily Returns

CWC Energy Services  vs.  ENB Financial Corp

CWC Energy Services

Risk-Adjusted Performance

Very Weak

Over the last 90 days CWC Energy Services has generated negative risk-adjusted returns adding no value to investors with long positions. Despite nearly stable essential indicators, CWC Energy is not utilizing all of its potentials. The current stock price disturbance, may contribute to mid-run losses for the stockholders.

ENB Financial Corp

Risk-Adjusted Performance

Very Weak

Over the last 90 days ENB Financial Corp has generated negative risk-adjusted returns adding no value to investors with long positions. Even with latest uncertain performance, the Stock's fundamental drivers remain invariable and the latest agitation on Wall Street may also be a sign of long-running gains for the enterprise retail investors.

Pair Trading with CWC Energy and ENB Financial

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

The idea behind CWC Energy Services and ENB Financial Corp 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.

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 Latest Portfolios module to quick portfolio dashboard that showcases your latest portfolios.