Correlation Between Enersize and Serstech

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

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

Diversification Opportunities for Enersize and Serstech

-0.16

Correlation Coefficient

Enersize  Serstech

Good diversification

The 3 months correlation between Enersize and Serstech is -0.16. Overlapping area represents the amount of risk that can be diversified away by holding Enersize Oy and Serstech AB in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Serstech AB and Enersize 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 Enersize Oy are associated (or correlated) with Serstech. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Serstech AB has no effect on the direction of Enersize i.e., Enersize and Serstech go up and down completely randomly.

Pair Corralation between Enersize and Serstech

Assuming the 90 days trading horizon Enersize Oy is expected to generate 4.27 times more return on investment than Serstech. However, Enersize is 4.27 times more volatile than Serstech AB. It trades about 0.01 of its potential returns per unit of risk. Serstech AB is currently generating about -0.13 per unit of risk. If you would invest  0.30  in Enersize Oy on April 24, 2025 and sell it today you would lose (0.09) from holding Enersize Oy or give up 30.0% of portfolio value over 90 days.

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

Enersize Oy  vs.  Serstech AB

Enersize Oy

Risk-Adjusted Performance

Very Weak

Over the last 90 days Enersize Oy has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of comparatively weak basic indicators, Enersize may actually be approaching a critical reversion point that can send shares even higher in August 2025.

Serstech AB

Risk-Adjusted Performance

Very Weak

Over the last 90 days Serstech AB has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of uncertain performance in the last few months, the Stock's basic indicators remain comparatively stable which may send shares a bit higher in August 2025. The newest uproar may also be a sign of mid-term up-swing for the firm private investors.

Pair Trading with Enersize and Serstech

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

The idea behind Enersize Oy and Serstech AB 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 Analyst Advice module to analyst recommendations and target price estimates broken down by several categories.