Correlation Between Endeavour Mining and Pressure Technologies

Can any of the company-specific risk be diversified away by investing in both Endeavour Mining and Pressure Technologies 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 Endeavour Mining and Pressure Technologies into the same portfolio, which is an essential part of the fundamental portfolio management process.

By analyzing existing cross correlation between Endeavour Mining Corp and Pressure Technologies Plc, you can compare the effects of market volatilities on Endeavour Mining and Pressure Technologies 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 Endeavour Mining with a short position of Pressure Technologies. Check out your portfolio center. Please also check ongoing floating volatility patterns of Endeavour Mining and Pressure Technologies.

Diversification Opportunities for Endeavour Mining and Pressure Technologies

-0.78

Correlation Coefficient

Endeavour Mining  Pressure Technologies

Pay attention - limited upside

The 3 months correlation between Endeavour and Pressure is -0.78. Overlapping area represents the amount of risk that can be diversified away by holding Endeavour Mining Corp and Pressure Technologies Plc in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Pressure Technologies Plc and Endeavour Mining 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 Endeavour Mining Corp are associated (or correlated) with Pressure Technologies. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Pressure Technologies Plc has no effect on the direction of Endeavour Mining i.e., Endeavour Mining and Pressure Technologies go up and down completely randomly.

Pair Corralation between Endeavour Mining and Pressure Technologies

Assuming the 90 days trading horizon Endeavour Mining Corp is expected to under-perform the Pressure Technologies. In addition to that, Endeavour Mining is 1.22 times more volatile than Pressure Technologies Plc. It trades about -0.12 of its total potential returns per unit of risk. Pressure Technologies Plc is currently generating about 0.05 per unit of volatility. If you would invest  3,400  in Pressure Technologies Plc on October 25, 2024 and sell it today you would earn a total of  150.00  from holding Pressure Technologies Plc or generate 4.41% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Against
Strength	Weak
Accuracy	100.0%
Values	Daily Returns

Endeavour Mining Corp  vs.  Pressure Technologies Plc

Endeavour Mining Corp

Risk-Adjusted Performance

0 of 100

Very Weak

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

Pressure Technologies Plc

Risk-Adjusted Performance

3 of 100

Insignificant

Compared to the overall equity markets, risk-adjusted returns on investments in Pressure Technologies Plc are ranked lower than 3 (%) of all global equities and portfolios over the last 90 days. In spite of comparatively stable basic indicators, Pressure Technologies is not utilizing all of its potentials. The newest stock price uproar, may contribute to short-horizon losses for the private investors.

Pair Trading with Endeavour Mining and Pressure Technologies

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

The idea behind Endeavour Mining Corp and Pressure Technologies Plc 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 Sync Your Broker module to sync your existing holdings, watchlists, positions or portfolios from thousands of online brokerage services, banks, investment account aggregators and robo-advisors..