Correlation Between Enzymatica Publ and Episurf Medical

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

By analyzing existing cross correlation between Enzymatica publ AB and Episurf Medical AB, you can compare the effects of market volatilities on Enzymatica Publ and Episurf Medical 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 Enzymatica Publ with a short position of Episurf Medical. Check out your portfolio center. Please also check ongoing floating volatility patterns of Enzymatica Publ and Episurf Medical.

Diversification Opportunities for Enzymatica Publ and Episurf Medical

0.51

Correlation Coefficient

Enzymatica Publ  Episurf Medical

Very weak diversification

The 3 months correlation between Enzymatica and Episurf is 0.51. Overlapping area represents the amount of risk that can be diversified away by holding Enzymatica publ AB and Episurf Medical AB in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Episurf Medical AB and Enzymatica Publ 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 Enzymatica publ AB are associated (or correlated) with Episurf Medical. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Episurf Medical AB has no effect on the direction of Enzymatica Publ i.e., Enzymatica Publ and Episurf Medical go up and down completely randomly.

Pair Corralation between Enzymatica Publ and Episurf Medical

Assuming the 90 days trading horizon Enzymatica publ AB is expected to under-perform the Episurf Medical. But the stock apears to be less risky and, when comparing its historical volatility, Enzymatica publ AB is 1.51 times less risky than Episurf Medical. The stock trades about -0.17 of its potential returns per unit of risk. The Episurf Medical AB is currently generating about -0.09 of returns per unit of risk over similar time horizon. If you would invest  18.00  in Episurf Medical AB on September 14, 2024 and sell it today you would lose (5.00) from holding Episurf Medical AB or give up 27.78% of portfolio value over 90 days.

Time Period	3 Months [change]
Direction	Moves Together
Strength	Weak
Accuracy	98.46%
Values	Daily Returns

Enzymatica publ AB  vs.  Episurf Medical AB

Enzymatica publ AB

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Enzymatica publ AB 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 basic indicators remain comparatively stable which may send shares a bit higher in January 2025. The newest uproar may also be a sign of mid-term up-swing for the firm private investors.

Episurf Medical AB

Risk-Adjusted Performance

0 of 100

Very Weak

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

Pair Trading with Enzymatica Publ and Episurf Medical

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

The idea behind Enzymatica publ AB and Episurf Medical AB 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 Bond Analysis module to evaluate and analyze corporate bonds as a potential investment for your portfolios..