Correlation Between Enova International and Trupanion

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

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

Diversification Opportunities for Enova International and Trupanion

0.51

Correlation Coefficient

Enova International  Trupanion

Very weak diversification

The 3 months correlation between Enova and Trupanion is 0.51. Overlapping area represents the amount of risk that can be diversified away by holding Enova International and Trupanion in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Trupanion and Enova International 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 Enova International are associated (or correlated) with Trupanion. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Trupanion has no effect on the direction of Enova International i.e., Enova International and Trupanion go up and down completely randomly.

Pair Corralation between Enova International and Trupanion

Given the investment horizon of 90 days Enova International is expected to generate 0.89 times more return on investment than Trupanion. However, Enova International is 1.12 times less risky than Trupanion. It trades about 0.09 of its potential returns per unit of risk. Trupanion is currently generating about 0.03 per unit of risk. If you would invest  9,253  in Enova International on May 6, 2025 and sell it today you would earn a total of  1,007  from holding Enova International or generate 10.88% return on investment over 90 days.

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

Enova International  vs.  Trupanion

Enova International

Risk-Adjusted Performance

OK

Compared to the overall equity markets, risk-adjusted returns on investments in Enova International are ranked lower than 7 (%) of all global equities and portfolios over the last 90 days. Despite somewhat uncertain basic indicators, Enova International may actually be approaching a critical reversion point that can send shares even higher in September 2025.

Trupanion

Risk-Adjusted Performance

Weak

Compared to the overall equity markets, risk-adjusted returns on investments in Trupanion are ranked lower than 2 (%) of all global equities and portfolios over the last 90 days. Even with relatively invariable basic indicators, Trupanion is not utilizing all of its potentials. The newest stock price agitation, may contribute to short-term losses for the retail investors.

Pair Trading with Enova International and Trupanion

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

The idea behind Enova International and Trupanion 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.

Check out your portfolio center.

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 Cryptocurrency Center module to build and monitor diversified portfolio of extremely risky digital assets and cryptocurrency.