Correlation Between Envela Corp and National Vision

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Can any of the company-specific risk be diversified away by investing in both Envela Corp and National Vision 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 National Vision into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Envela Corp and National Vision Holdings, you can compare the effects of market volatilities on Envela Corp and National Vision 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 National Vision. Check out your portfolio center. Please also check ongoing floating volatility patterns of Envela Corp and National Vision.

Diversification Opportunities for Envela Corp and National Vision

-0.5
  Correlation Coefficient

Very good diversification

The 3 months correlation between Envela and National is -0.5. Overlapping area represents the amount of risk that can be diversified away by holding Envela Corp and National Vision Holdings in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on National Vision Holdings 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 National Vision. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of National Vision Holdings has no effect on the direction of Envela Corp i.e., Envela Corp and National Vision go up and down completely randomly.

Pair Corralation between Envela Corp and National Vision

Considering the 90-day investment horizon Envela Corp is expected to generate 1.35 times more return on investment than National Vision. However, Envela Corp is 1.35 times more volatile than National Vision Holdings. It trades about 0.25 of its potential returns per unit of risk. National Vision Holdings is currently generating about 0.04 per unit of risk. If you would invest  530.00  in Envela Corp on April 1, 2022 and sell it today you would earn a total of  154.00  from holding Envela Corp or generate 29.06% return on investment over 90 days.
Time Period3 Months [change]
DirectionMoves Against 
StrengthVery Weak
Accuracy100.0%
ValuesDaily Returns

Envela Corp  vs.  National Vision Holdings

 Performance (%) 
      Timeline 
Envela Corp 
Envela Performance
13 of 100
Compared to the overall equity markets, risk-adjusted returns on investments in Envela Corp are ranked lower than 13 (%) of all global equities and portfolios over the last 90 days. Despite somewhat unfluctuating essential indicators, Envela Corp sustained solid returns over the last few months and may actually be approaching a breakup point.

Envela Price Channel

National Vision Holdings 
National Performance
0 of 100
Over the last 90 days National Vision Holdings has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of unfluctuating performance in the last few months, the Stock's basic indicators remain rather sound which may send shares a bit higher in July 2022. The latest tumult may also be a sign of longer-term up-swing for the firm shareholders.

National Price Channel

Envela Corp and National Vision Volatility Contrast

 Predicted Return Density 
      Returns 

Pair Trading with Envela Corp and National Vision

The main advantage of trading using opposite Envela Corp and National Vision positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Envela Corp position performs unexpectedly, National Vision 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 National Vision will offset losses from the drop in National Vision's long position.
The idea behind Envela Corp and National Vision Holdings 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 Financial Widgets module to easily integrated Macroaxis content with over 30 different plug-and-play financial widgets.

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