Correlation Between Enhanced and Performance Trust

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

By analyzing existing cross correlation between Enhanced Large Pany and Performance Trust Credit, you can compare the effects of market volatilities on Enhanced and Performance Trust 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 Enhanced with a short position of Performance Trust. Check out your portfolio center. Please also check ongoing floating volatility patterns of Enhanced and Performance Trust.

Diversification Opportunities for Enhanced and Performance Trust

0.79

Correlation Coefficient

Enhanced  Performance Trust

Poor diversification

The 3 months correlation between Enhanced and Performance is 0.79. Overlapping area represents the amount of risk that can be diversified away by holding Enhanced Large Pany and Performance Trust Credit in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Performance Trust Credit and Enhanced 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 Enhanced Large Pany are associated (or correlated) with Performance Trust. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Performance Trust Credit has no effect on the direction of Enhanced i.e., Enhanced and Performance Trust go up and down completely randomly.

Pair Corralation between Enhanced and Performance Trust

Assuming the 90 days horizon Enhanced Large Pany is expected to generate 3.18 times more return on investment than Performance Trust. However, Enhanced is 3.18 times more volatile than Performance Trust Credit. It trades about 0.2 of its potential returns per unit of risk. Performance Trust Credit is currently generating about 0.13 per unit of risk. If you would invest  1,495  in Enhanced Large Pany on May 19, 2025 and sell it today you would earn a total of  129.00  from holding Enhanced Large Pany or generate 8.63% return on investment over 90 days.

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

Enhanced Large Pany  vs.  Performance Trust Credit

Enhanced Large Pany

Risk-Adjusted Performance

Good

Compared to the overall equity markets, risk-adjusted returns on investments in Enhanced Large Pany are ranked lower than 15 (%) of all funds and portfolios of funds over the last 90 days. In spite of fairly weak essential indicators, Enhanced may actually be approaching a critical reversion point that can send shares even higher in September 2025.

Performance Trust Credit

Risk-Adjusted Performance

Fair

Compared to the overall equity markets, risk-adjusted returns on investments in Performance Trust Credit are ranked lower than 10 (%) of all funds and portfolios of funds over the last 90 days. In spite of fairly strong basic indicators, Performance Trust is not utilizing all of its potentials. The current stock price disturbance, may contribute to short-term losses for the investors.

Pair Trading with Enhanced and Performance Trust

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

The idea behind Enhanced Large Pany and Performance Trust Credit 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 Share Portfolio module to track or share privately all of your investments from the convenience of any device.