# Correlation Between Ensign and NYSE Composite

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

## Diversification Opportunities for Ensign and NYSE Composite

 0.69 Correlation Coefficient

### Poor diversification

The 3 months correlation between Ensign and NYSE is 0.69. Overlapping area represents the amount of risk that can be diversified away by holding The Ensign Group and NYSE Composite in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on NYSE Composite and Ensign 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 The Ensign Group are associated (or correlated) with NYSE Composite. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of NYSE Composite has no effect on the direction of Ensign i.e., Ensign and NYSE Composite go up and down completely randomly.

## Pair Corralation between Ensign and NYSE Composite

Assuming the 90 days horizon The Ensign Group is expected to generate 2.21 times more return on investment than NYSE Composite. However, Ensign is 2.21 times more volatile than NYSE Composite. It trades about 0.07 of its potential returns per unit of risk. NYSE Composite is currently generating about 0.09 per unit of risk. If you would invest  8,300  in The Ensign Group on March 12, 2023 and sell it today you would earn a total of  200.00  from holding The Ensign Group or generate 2.41% return on investment over 90 days.
 Time Period 3 Months [change] Direction Moves Together Strength Significant Accuracy 95.45% Values Daily Returns

## The Ensign Group  vs.  NYSE Composite

 Performance (%)
 Timeline

## Ensign and NYSE Composite Volatility Contrast

 Predicted Return Density
 Returns

## Pair Trading with Ensign and NYSE Composite

The main advantage of trading using opposite Ensign and NYSE Composite positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Ensign position performs unexpectedly, NYSE Composite 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 NYSE Composite will offset losses from the drop in NYSE Composite's long position.
 Ensign vs. Corporate Office Properties Ensign vs. Tri Pointe Homes Ensign vs. GREENX METALS LTD Ensign vs. Taylor Morrison Home
The idea behind The Ensign Group and NYSE Composite 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.
 NYSE Composite vs. Harmony Gold Mining NYSE Composite vs. NH Foods NYSE Composite vs. Albertsons Companies NYSE Composite vs. Mangazeya Mining
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 Theme Ratings module to determine theme ratings based on digital equity recommendations. Macroaxis theme ratings are based on combination of fundamental analysis and risk-adjusted market performance.

## Other Complementary Tools

 Balance Of PowerCheck stock momentum by analyzing Balance Of Power indicator and other technical ratios Portfolio VolatilityCheck portfolio volatility and analyze historical return density to properly model market risk Correlation AnalysisReduce portfolio risk simply by holding instruments which are not perfectly correlated Stock ScreenerFind equities using a custom stock filter or screen asymmetry in trading patterns, price, volume, or investment outlook. Money ManagersScreen money managers from public funds and ETFs managed around the world Correlation AnalysisReduce portfolio risk simply by holding instruments which are not perfectly correlated Balance Of PowerCheck stock momentum by analyzing Balance Of Power indicator and other technical ratios Balance Of PowerCheck stock momentum by analyzing Balance Of Power indicator and other technical ratios