Correlation Between Envela Corp and Build-A-Bear Workshop

Specify exactly 2 symbols:
Can any of the company-specific risk be diversified away by investing in both Envela Corp and Build-A-Bear Workshop 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 Envela Corp and Build-A-Bear Workshop into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Envela Corp and Build-A-Bear Workshop, you can compare the effects of market volatilities on Envela Corp and Build-A-Bear Workshop 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 Envela Corp with a short position of Build-A-Bear Workshop. Check out your portfolio center. Please also check ongoing floating volatility patterns of Envela Corp and Build-A-Bear Workshop.

Diversification Opportunities for Envela Corp and Build-A-Bear Workshop

0.09
  Correlation Coefficient

Significant diversification

The 3 months correlation between Envela and Build-A-Bear is 0.09. Overlapping area represents the amount of risk that can be diversified away by holding Envela Corp and Build-A-Bear Workshop in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Build-A-Bear Workshop and Envela Corp 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 Envela Corp are associated (or correlated) with Build-A-Bear Workshop. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Build-A-Bear Workshop has no effect on the direction of Envela Corp i.e., Envela Corp and Build-A-Bear Workshop go up and down completely randomly.

Pair Corralation between Envela Corp and Build-A-Bear Workshop

Considering the 90-day investment horizon Envela Corp is expected to generate 4.62 times less return on investment than Build-A-Bear Workshop. But when comparing it to its historical volatility, Envela Corp is 1.48 times less risky than Build-A-Bear Workshop. It trades about 0.03 of its potential returns per unit of risk. Build-A-Bear Workshop is currently generating about 0.1 of returns per unit of risk over similar time horizon. If you would invest  187.00  in Build-A-Bear Workshop on March 29, 2022 and sell it today you would earn a total of  1,490  from holding Build-A-Bear Workshop or generate 796.79% return on investment over 90 days.
Time Period3 Months [change]
DirectionMoves Together 
StrengthInsignificant
Accuracy100.0%
ValuesDaily Returns

Envela Corp  vs.  Build-A-Bear Workshop

 Performance (%) 
      Timeline 
Envela Corp 
Envela Performance
14 of 100
Compared to the overall equity markets, risk-adjusted returns on investments in Envela Corp are ranked lower than 14 (%) of all global equities and portfolios over the last 90 days. Despite somewhat conflicting essential indicators, Envela Corp sustained solid returns over the last few months and may actually be approaching a breakup point.

Envela Price Channel

Build-A-Bear Workshop 
Build-A-Bear Performance
0 of 100
Over the last 90 days Build-A-Bear Workshop has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of fairly stable fundamental drivers, Build-A-Bear Workshop is not utilizing all of its potentials. The latest stock price fuss, may contribute to near-short-term losses for the sophisticated investors.

Structure and Payout Changes

Payout Ratio
0.4
Dividend Date
2021-12-27
Ex Dividend Date
2021-12-09

Build-A-Bear Price Channel

Envela Corp and Build-A-Bear Workshop Volatility Contrast

 Predicted Return Density 
      Returns 

Pair Trading with Envela Corp and Build-A-Bear Workshop

The main advantage of trading using opposite Envela Corp and Build-A-Bear Workshop positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Envela Corp position performs unexpectedly, Build-A-Bear Workshop 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 Build-A-Bear Workshop will offset losses from the drop in Build-A-Bear Workshop's long position.
The idea behind Envela Corp and Build-A-Bear Workshop 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.

Build-A-Bear Workshop

Pair trading matchups for Build-A-Bear Workshop

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 Fundamentals Comparison module to compare fundamentals across multiple equities to find investing opportunities.

Other Complementary Tools

Equity Analysis
Research over 250,000 global equities including funds, stocks and ETFs to find investment opportunities
Go
Watchlist Optimization
Optimize watchlists to build efficient portfolio or rebalance existing positions based on mean-variance optimization algorithm
Go
Fundamental Analysis
View fundamental data based on most recent published financial statements
Go
Financial Widgets
Easily integrated Macroaxis content with over 30 different plug-and-play financial widgets
Go
Risk-Return Analysis
View associations between returns expected from investment and the risk you assume
Go
Performance Analysis
Check effects of mean-variance optimization against your current asset allocation
Go
Content Syndication
Quickly integrate customizable finance content to your own investment portal
Go