Correlation Between Enerpac Tool and Xometry

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

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

Diversification Opportunities for Enerpac Tool and Xometry

-0.4

Correlation Coefficient

Enerpac Tool  Xometry

Very good diversification

The 3 months correlation between Enerpac and Xometry is -0.4. Overlapping area represents the amount of risk that can be diversified away by holding Enerpac Tool Group and Xometry in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Xometry and Enerpac Tool 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 Enerpac Tool Group are associated (or correlated) with Xometry. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Xometry has no effect on the direction of Enerpac Tool i.e., Enerpac Tool and Xometry go up and down completely randomly.

Pair Corralation between Enerpac Tool and Xometry

Given the investment horizon of 90 days Enerpac Tool Group is expected to generate 0.38 times more return on investment than Xometry. However, Enerpac Tool Group is 2.64 times less risky than Xometry. It trades about -0.07 of its potential returns per unit of risk. Xometry is currently generating about -0.13 per unit of risk. If you would invest  4,852  in Enerpac Tool Group on December 12, 2024 and sell it today you would lose (357.00) from holding Enerpac Tool Group or give up 7.36% of portfolio value over 90 days.

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

Enerpac Tool Group  vs.  Xometry

Enerpac Tool Group

Risk-Adjusted Performance

Very Weak

Over the last 90 days Enerpac Tool Group has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of latest weak performance, the Stock's basic indicators remain sound and the latest tumult on Wall Street may also be a sign of longer-term gains for the firm shareholders.

Xometry

Risk-Adjusted Performance

Very Weak

Over the last 90 days Xometry has generated negative risk-adjusted returns adding no value to investors with long positions. Even with weak performance in the last few months, the Stock's basic indicators remain relatively invariable which may send shares a bit higher in April 2025. The latest agitation may also be a sign of long-running up-swing for the enterprise retail investors.

Pair Trading with Enerpac Tool and Xometry

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

The idea behind Enerpac Tool Group and Xometry 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 Content Syndication module to quickly integrate customizable finance content to your own investment portal.