Correlation Between Graham and Enerpac Tool

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

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

Diversification Opportunities for Graham and Enerpac Tool

-0.65

Correlation Coefficient

Graham  Enerpac Tool

Excellent diversification

The 3 months correlation between Graham and Enerpac is -0.65. Overlapping area represents the amount of risk that can be diversified away by holding Graham and Enerpac Tool Group in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Enerpac Tool Group and Graham 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 Graham are associated (or correlated) with Enerpac Tool. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Enerpac Tool Group has no effect on the direction of Graham i.e., Graham and Enerpac Tool go up and down completely randomly.

Pair Corralation between Graham and Enerpac Tool

Considering the 90-day investment horizon Graham is expected to generate 1.44 times more return on investment than Enerpac Tool. However, Graham is 1.44 times more volatile than Enerpac Tool Group. It trades about 0.34 of its potential returns per unit of risk. Enerpac Tool Group is currently generating about -0.09 per unit of risk. If you would invest  3,290  in Graham on May 4, 2025 and sell it today you would earn a total of  2,261  from holding Graham or generate 68.72% return on investment over 90 days.

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

Graham  vs.  Enerpac Tool Group

Graham

Risk-Adjusted Performance

Strong

Compared to the overall equity markets, risk-adjusted returns on investments in Graham are ranked lower than 26 (%) of all global equities and portfolios over the last 90 days. In spite of very weak technical indicators, Graham displayed solid returns over the last few months and may actually be approaching a breakup point.

Enerpac Tool Group

Risk-Adjusted Performance

Very Weak

Over the last 90 days Enerpac Tool Group has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of latest unsteady performance, the Stock's basic indicators remain sound and the latest tumult on Wall Street may also be a sign of longer-term gains for the firm shareholders.

Pair Trading with Graham and Enerpac Tool

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

The idea behind Graham and Enerpac Tool Group 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 Portfolio Suggestion module to get suggestions outside of your existing asset allocation including your own model portfolios.