Correlation Between Ennogie Solar and BankInvest Optima

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

By analyzing existing cross correlation between Ennogie Solar Group and BankInvest Optima 10, you can compare the effects of market volatilities on Ennogie Solar and BankInvest Optima 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 Ennogie Solar with a short position of BankInvest Optima. Check out your portfolio center. Please also check ongoing floating volatility patterns of Ennogie Solar and BankInvest Optima.

Diversification Opportunities for Ennogie Solar and BankInvest Optima

0.1

Correlation Coefficient

Ennogie Solar  BankInvest Optima

Average diversification

The 3 months correlation between Ennogie and BankInvest is 0.1. Overlapping area represents the amount of risk that can be diversified away by holding Ennogie Solar Group and BankInvest Optima 10 in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on BankInvest Optima and Ennogie Solar 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 Ennogie Solar Group are associated (or correlated) with BankInvest Optima. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of BankInvest Optima has no effect on the direction of Ennogie Solar i.e., Ennogie Solar and BankInvest Optima go up and down completely randomly.

Pair Corralation between Ennogie Solar and BankInvest Optima

Assuming the 90 days trading horizon Ennogie Solar Group is expected to under-perform the BankInvest Optima. In addition to that, Ennogie Solar is 15.1 times more volatile than BankInvest Optima 10. It trades about -0.14 of its total potential returns per unit of risk. BankInvest Optima 10 is currently generating about -0.08 per unit of volatility. If you would invest  10,350  in BankInvest Optima 10 on December 25, 2024 and sell it today you would lose (150.00) from holding BankInvest Optima 10 or give up 1.45% of portfolio value over 90 days.

Time Period	3 Months [change]
Direction	Moves Together
Strength	Insignificant
Accuracy	95.08%
Values	Daily Returns

Ennogie Solar Group  vs.  BankInvest Optima 10

Ennogie Solar Group

Risk-Adjusted Performance

Very Weak

Over the last 90 days Ennogie Solar Group has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of weak performance in the last few months, the Stock's technical and fundamental indicators remain very healthy which may send shares a bit higher in April 2025. The recent disarray may also be a sign of long period up-swing for the firm investors.

BankInvest Optima

Risk-Adjusted Performance

Very Weak

Over the last 90 days BankInvest Optima 10 has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of rather sound fundamental indicators, BankInvest Optima is not utilizing all of its potentials. The current stock price tumult, may contribute to shorter-term losses for the shareholders.

Pair Trading with Ennogie Solar and BankInvest Optima

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

The idea behind Ennogie Solar Group and BankInvest Optima 10 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 Top Crypto Exchanges module to search and analyze digital assets across top global cryptocurrency exchanges.