Correlation Between EZGO Technologies and Sacks Parente

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

By analyzing existing cross correlation between EZGO Technologies and Sacks Parente Golf,, you can compare the effects of market volatilities on EZGO Technologies and Sacks Parente 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 EZGO Technologies with a short position of Sacks Parente. Check out your portfolio center. Please also check ongoing floating volatility patterns of EZGO Technologies and Sacks Parente.

Diversification Opportunities for EZGO Technologies and Sacks Parente

0.26

Correlation Coefficient

EZGO Technologies  Sacks Parente

Modest diversification

The 3 months correlation between EZGO and Sacks is 0.26. Overlapping area represents the amount of risk that can be diversified away by holding EZGO Technologies and Sacks Parente Golf, in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Sacks Parente Golf, and EZGO Technologies 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 EZGO Technologies are associated (or correlated) with Sacks Parente. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Sacks Parente Golf, has no effect on the direction of EZGO Technologies i.e., EZGO Technologies and Sacks Parente go up and down completely randomly.

Pair Corralation between EZGO Technologies and Sacks Parente

Given the investment horizon of 90 days EZGO Technologies is expected to under-perform the Sacks Parente. But the stock apears to be less risky and, when comparing its historical volatility, EZGO Technologies is 4.68 times less risky than Sacks Parente. The stock trades about -0.22 of its potential returns per unit of risk. The Sacks Parente Golf, is currently generating about 0.01 of returns per unit of risk over similar time horizon. If you would invest  36.00  in Sacks Parente Golf, on December 27, 2024 and sell it today you would lose (26.00) from holding Sacks Parente Golf, or give up 72.22% of portfolio value over 90 days.

Time Period	3 Months [change]
Direction	Moves Together
Strength	Very Weak
Accuracy	88.33%
Values	Daily Returns

EZGO Technologies  vs.  Sacks Parente Golf,

EZGO Technologies

Risk-Adjusted Performance

Very Weak

Over the last 90 days EZGO Technologies 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.

Sacks Parente Golf,

Risk-Adjusted Performance

Very Weak

Over the last 90 days Sacks Parente Golf, has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of rather unfluctuating technical and fundamental indicators, Sacks Parente exhibited solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with EZGO Technologies and Sacks Parente

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

The idea behind EZGO Technologies and Sacks Parente Golf, 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 Fundamentals Comparison module to compare fundamentals across multiple equities to find investing opportunities.