Correlation Between Energizer Holdings and Moog

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

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

Diversification Opportunities for Energizer Holdings and Moog

0.53

Correlation Coefficient

Energizer Holdings  Moog

Very weak diversification

The 3 months correlation between Energizer and Moog is 0.53. Overlapping area represents the amount of risk that can be diversified away by holding Energizer Holdings and Moog Inc in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Moog Inc and Energizer Holdings 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 Energizer Holdings are associated (or correlated) with Moog. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Moog Inc has no effect on the direction of Energizer Holdings i.e., Energizer Holdings and Moog go up and down completely randomly.

Pair Corralation between Energizer Holdings and Moog

Considering the 90-day investment horizon Energizer Holdings is expected to generate 0.71 times more return on investment than Moog. However, Energizer Holdings is 1.41 times less risky than Moog. It trades about 0.13 of its potential returns per unit of risk. Moog Inc is currently generating about 0.0 per unit of risk. If you would invest  3,151  in Energizer Holdings on September 28, 2024 and sell it today you would earn a total of  408.00  from holding Energizer Holdings or generate 12.95% return on investment over 90 days.

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

Energizer Holdings  vs.  Moog Inc

Energizer Holdings

Risk-Adjusted Performance

10 of 100

OK

Compared to the overall equity markets, risk-adjusted returns on investments in Energizer Holdings are ranked lower than 10 (%) of all global equities and portfolios over the last 90 days. Even with relatively inconsistent basic indicators, Energizer Holdings reported solid returns over the last few months and may actually be approaching a breakup point.

Moog Inc

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Moog Inc has generated negative risk-adjusted returns adding no value to investors with long positions. Despite somewhat strong basic indicators, Moog is not utilizing all of its potentials. The latest stock price disturbance, may contribute to short-term losses for the investors.

Pair Trading with Energizer Holdings and Moog

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

The idea behind Energizer Holdings and Moog Inc 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 Piotroski F Score module to get Piotroski F Score based on the binary analysis strategy of nine different fundamentals.