Correlation Between Enerpac Tool and Hurco Companies

Can any of the company-specific risk be diversified away by investing in both Enerpac Tool and Hurco Companies 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 Hurco Companies 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 Hurco Companies, you can compare the effects of market volatilities on Enerpac Tool and Hurco Companies 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 Hurco Companies. Check out your portfolio center. Please also check ongoing floating volatility patterns of Enerpac Tool and Hurco Companies.

Diversification Opportunities for Enerpac Tool and Hurco Companies

-0.78

Correlation Coefficient

Enerpac Tool  Hurco Companies

Pay attention - limited upside

The 3 months correlation between Enerpac and Hurco is -0.78. Overlapping area represents the amount of risk that can be diversified away by holding Enerpac Tool Group and Hurco Companies in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Hurco Companies 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 Hurco Companies. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Hurco Companies has no effect on the direction of Enerpac Tool i.e., Enerpac Tool and Hurco Companies go up and down completely randomly.

Pair Corralation between Enerpac Tool and Hurco Companies

Given the investment horizon of 90 days Enerpac Tool Group is expected to generate 0.58 times more return on investment than Hurco Companies. However, Enerpac Tool Group is 1.72 times less risky than Hurco Companies. It trades about 0.19 of its potential returns per unit of risk. Hurco Companies is currently generating about -0.3 per unit of risk. If you would invest  3,495  in Enerpac Tool Group on February 3, 2024 and sell it today you would earn a total of  153.00  from holding Enerpac Tool Group or generate 4.38% return on investment over 90 days.

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

Enerpac Tool Group  vs.  Hurco Companies

Enerpac Tool Group

Risk-Adjusted Performance

16 of 100

Good

Compared to the overall equity markets, risk-adjusted returns on investments in Enerpac Tool Group are ranked lower than 16 (%) of all global equities and portfolios over the last 90 days. In spite of rather weak basic indicators, Enerpac Tool exhibited solid returns over the last few months and may actually be approaching a breakup point.

Hurco Companies

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Hurco Companies 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 basic indicators remain rather sound which may send shares a bit higher in June 2024. The latest tumult may also be a sign of longer-term up-swing for the firm shareholders.

Pair Trading with Enerpac Tool and Hurco Companies

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

The idea behind Enerpac Tool Group and Hurco Companies 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 My Watchlist Analysis module to analyze my current watchlist and to refresh optimization strategy. Macroaxis watchlist is based on self-learning algorithm to remember stocks you like.