Correlation Between Chardan NexTech and Enovix Corp

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

By analyzing existing cross correlation between Chardan NexTech Acquisition and Enovix Corp, you can compare the effects of market volatilities on Chardan NexTech and Enovix Corp 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 Chardan NexTech with a short position of Enovix Corp. Check out your portfolio center. Please also check ongoing floating volatility patterns of Chardan NexTech and Enovix Corp.

Diversification Opportunities for Chardan NexTech and Enovix Corp

-0.58

Correlation Coefficient

Chardan NexTech  Enovix Corp

Excellent diversification

The 3 months correlation between Chardan and Enovix is -0.58. Overlapping area represents the amount of risk that can be diversified away by holding Chardan NexTech Acquisition and Enovix Corp in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Enovix Corp and Chardan NexTech 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 Chardan NexTech Acquisition are associated (or correlated) with Enovix Corp. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Enovix Corp has no effect on the direction of Chardan NexTech i.e., Chardan NexTech and Enovix Corp go up and down completely randomly.

Pair Corralation between Chardan NexTech and Enovix Corp

Given the investment horizon of 90 days Chardan NexTech is expected to generate 50.72 times less return on investment than Enovix Corp. In addition to that, Chardan NexTech is 2.9 times more volatile than Enovix Corp. It trades about 0.0 of its total potential returns per unit of risk. Enovix Corp is currently generating about 0.19 per unit of volatility. If you would invest  618.00  in Enovix Corp on May 7, 2025 and sell it today you would earn a total of  481.00  from holding Enovix Corp or generate 77.83% return on investment over 90 days.

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

Chardan NexTech Acquisition  vs.  Enovix Corp

Chardan NexTech Acqu

Risk-Adjusted Performance

Very Weak

Over the last 90 days Chardan NexTech Acquisition has generated negative risk-adjusted returns adding no value to investors with long positions. Despite fairly strong essential indicators, Chardan NexTech is not utilizing all of its potentials. The recent stock price confusion, may contribute to short-horizon losses for the traders.

Enovix Corp

Risk-Adjusted Performance

Good

Compared to the overall equity markets, risk-adjusted returns on investments in Enovix Corp are ranked lower than 15 (%) of all global equities and portfolios over the last 90 days. In spite of fairly unsteady basic indicators, Enovix Corp showed solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with Chardan NexTech and Enovix Corp

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

The idea behind Chardan NexTech Acquisition and Enovix Corp 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 Fundamental Analysis module to view fundamental data based on most recent published financial statements.