# Encore Stock Volatility

WIRE | Stock | ## USD 138.77 8.04 5.48% |

Encore Wire appears to be very steady, given 3 months investment horizon. Encore Wire secures Sharpe Ratio (or Efficiency) of 0.069, which denotes the company had 0.069% of return per unit of standard deviation over the last 3 months. Our philosophy in predicting the volatility of a stock is to use all available market data together with stock-specific technical indicators that cannot be diversified away. We have found twenty-one technical indicators for Encore Wire, which you can use to evaluate the future volatility of the firm. Please utilize Encore Wire's Downside Deviation of 3.19, mean deviation of 2.17, and Semi Deviation of 2.95 to check if our risk estimates are consistent with your expectations.

Encore |

Encore Wire Stock volatility depicts how high the prices fluctuate around the mean (or its average) price. In other words, it is a statistical measure of the distribution of Encore daily returns, and it is calculated using variance and standard deviation. We also use Encore's beta, its sensitivity to the market, as well as its odds of financial distress to provide a more practical estimation of Encore Wire volatility.

### 30 Days Market Risk

### Chance of Distress

### 30 Days Economic Sensitivity

Since volatility provides investors with entry points to take advantage of stock prices, companies, such as Encore Wire can benefit from it. Downward market volatility can be a perfect environment for investors who play the long game. Here, they may decide to buy additional stocks of Encore Wire at lower prices. For example, an investor can purchase Encore stock that has halved in price over a short period. This will lower your average cost per share, thereby improving your portfolio's performance when the markets normalize. Similarly, when the prices of Encore Wire's stock rises, investors can sell out and invest the proceeds in other equities with better opportunities. Investing when markets are volatile with better valuations will accord both investors and companies the opportunity to generate better long-term returns.

## Moving together with Encore Wire

+ | 0.83 | ABB | ABB | PairCorr | |||

+ | 0.94 | AYI | Acuity Brands | PairCorr | |||

+ | 0.86 | ENS | Enersys | PairCorr | |||

+ | 0.85 | HUBB | Hubbell | PairCorr | |||

+ | 0.9 | NVT | NVent Electric PLC | PairCorr |

## Moving against Encore Wire

## Encore Wire Market Sensitivity And Downside Risk

Encore Wire's beta coefficient measures the volatility of Encore stock compared to the systematic risk of the entire stock market represented by your selected benchmark. In mathematical terms, beta represents the slope of the line through a regression of data points where each of these points represents Encore stock's returns against your selected market. In other words, Encore Wire's beta of 1.17 provides an investor with an approximation of how much risk Encore Wire stock can potentially add to one of your existing portfolios.

Encore Wire shows above-average downside volatility for the selected time horizon. We advise investors to inspect Encore Wire further and ensure that all market timing and asset allocation strategies are consistent with the estimation of Encore Wire future alpha. Understanding different market volatility trends often help investors to time the market. Properly using volatility indicators enable traders to measure Encore Wire's stock risk against market volatility during both bullish and bearish trends. The higher level of volatility that comes with bear markets can directly impact Encore Wire's stock price while adding stress to investors as they watch their shares' value plummet. This usually forces investors to rebalance their portfolios by buying different stocks as prices fall. 3 Months Beta |Analyze Encore Wire Demand TrendCheck current 90 days Encore Wire correlation with market (NYSE Composite)## Encore Beta |

Encore standard deviation measures the daily dispersion of prices over your selected time horizon relative to its mean. Typical volatile equity has a high standard deviation, while the deviation of a stable instrument is usually low. As a downside, the standard deviation calculates all uncertainty as risk, even when it is in your favor, such as above-average returns.

## Standard Deviation | 2.92 |

It is essential to understand the difference between upside risk (as represented by Encore Wire's standard deviation) and the downside risk, which can be measured by semi-deviation or downside deviation of Encore Wire's daily returns or price. Since the actual investment returns on holding a position in encore stock tend to have a non-normal distribution, there will be different probabilities for losses than for gains. The likelihood of losses is reflected in the downside risk of an investment in Encore Wire.

## Using Encore Put Option to Manage Risk

Put options written on Encore Wire grant holders of the option the right to sell a specified amount of Encore Wire at a specified price within a specified time frame. The put buyer has a limited loss and, while not fully unlimited gains, as the price of Encore Stock cannot fall below zero, the put buyer does gain as the price drops. So, one way investors can hedge Encore Wire's position is by buying a put option against it. The put option used this way is usually referred to as insurance. If an undesired outcome occurs and loss on holding Encore Wire will be realized, the loss incurred will be offset by the profits made with the option trade.

### Encore Wire's PUT expiring on 2022-12-16

Profit |

Share

Encore Wire Price At Expiration |

### Current Encore Wire Insurance Chain

Delta | Gamma | Open Int | Expiration | Current Spread | Last Price | |||

Put | 2022-12-16 PUT at $165.0 | -0.9029 | 0.0098 | 1 | 2022-12-16 | 25.7 - 28.1 | 17.37 | View |

Put | 2022-12-16 PUT at $160.0 | -0.9598 | 0.0079 | 1 | 2022-12-16 | 19.6 - 23.1 | 17.9 | View |

Put | 2022-12-16 PUT at $155.0 | -0.8125 | 0.0167 | 22 | 2022-12-16 | 14.7 - 17.7 | 13.4 | View |

Put | 2022-12-16 PUT at $150.0 | -0.8609 | 0.0233 | 35 | 2022-12-16 | 10.4 - 13.2 | 6.6 | View |

Put | 2022-12-16 PUT at $145.0 | -0.6904 | 0.0317 | 35 | 2022-12-16 | 7.7 - 8.8 | 6.8 | View |

Put | 2022-12-16 PUT at $140.0 | -0.5244 | 0.0361 | 34 | 2022-12-16 | 4.5 - 6.0 | 5.0 | View |

Put | 2022-12-16 PUT at $135.0 | -0.3317 | 0.0371 | 11 | 2022-12-16 | 2.1 - 3.5 | 2.24 | View |

Put | 2022-12-16 PUT at $130.0 | -0.2119 | 0.0239 | 14 | 2022-12-16 | 0.2 - 2.85 | 1.5 | View |

Put | 2022-12-16 PUT at $125.0 | -0.1069 | 0.0151 | 41 | 2022-12-16 | 0.2 - 1.1 | 1.3 | View |

## Encore Wire Stock Volatility Analysis

Volatility refers to the frequency at which Encore Wire stock price increases or decreases within a specified period. These fluctuations usually indicate the level of risk that's associated with Encore Wire's price changes. Investors will then calculate the volatility of Encore Wire's stock to predict their future moves. A stock that has erratic price changes quickly hits new highs, and lows are considered highly volatile. A stock with relatively stable price changes has low volatility. A highly volatile stock is riskier, but the risk cuts both ways. Investing in highly volatile security can either be highly successful, or you may experience significant failure. There are two main types of Encore Wire's volatility:

### Historical Volatility

This type of stock volatility measures Encore Wire's fluctuations based on previous trends. It's commonly used to predict Encore Wire's future behavior based on its past. However, it cannot conclusively determine the future direction of the stock.### Implied Volatility

This type of volatility provides a positive outlook on future price fluctuations for Encore Wire's current market price. This means that the stock will return to its initially predicted market price. This type of volatility can be derived from derivative instruments written on Encore Wire's to be redeemed at a future date.Transformation |

The output start index for this execution was zero with a total number of output elements of sixty-one. Encore Wire Average Price is the average of the sum of open, high, low and close daily prices of a bar. It can be used to smooth an indicator that normally takes just the closing price as input..

## Encore Wire Projected Return Density Against Market

Given the investment horizon of 90 days the stock has the beta coefficient of 1.1742 . This entails as the benchmark fluctuates upward, the company is expected to outperform it on average. However, if the benchmark returns are projected to be negative, Encore Wire will likely underperform.Most traded equities are subject to two types of risk - systematic (i.e., market) and unsystematic (i.e., nonmarket or company-specific) risk. Unsystematic risk is the risk that events specific to Encore Wire or Electrical Equipment sector will adversely affect the stock's price. This type of risk can be diversified away by owning several different stocks in different industries whose stock prices have shown a small correlation to each other. On the other hand, systematic risk is the risk that Encore Wire's price will be affected by overall stock market movements and cannot be diversified away. So, no matter how many positions you have, you cannot eliminate market risk. However, you can measure a Encore stock's historical response to market movements and buy it if you are comfortable with its volatility direction. Beta and standard deviation are two commonly used measures to help you make the right decision.

The company has an alpha of 0.0479, implying that it can generate a 0.0479 percent excess return over NYSE Composite after adjusting for the inherited market risk (beta). Predicted Return Density |

Returns |

## What Drives an Encore Wire Price Volatility?

Several factors can influence a Stock's stock volatility:### Industry

Specific events can influence volatility within a particular industry. For instance, a significant weather upheaval in a crucial oil-production site may cause oil prices to increase in the oil sector. The direct result will be the rise in the stock price of oil distribution companies. Similarly, any government regulation in a specific industry could negatively influence stock prices due to increased regulations on compliance that may impact the company's future earnings and growth.### Political and Economic environment

When governments make significant decisions regarding trade agreements, policies, and legislation regarding specific industries, they will influence stock prices. Everything from speeches to elections may influence investors, who can directly influence the stock prices in any particular industry. The prevailing economic situation also plays a significant role in stock prices. When the economy is doing well, investors will have a positive reaction and hence, better stock prices and vice versa.### The Company's Performance

Sometimes volatility will only affect an individual company. For example, a revolutionary product launch or strong earnings report may attract many investors to purchase the company. This positive attention will raise the company's stock price. In contrast, product recalls and data breaches may negatively influence a company's stock prices.## Encore Wire Stock Risk Measures

Most traded equities are subject to two types of risk - systematic (i.e., market) and unsystematic (i.e., nonmarket or company-specific) risk. Unsystematic risk is the risk that events specific to Encore Wire or Electrical Equipment sector will adversely affect the stock's price. This type of risk can be diversified away by owning several different stocks in different industries whose stock prices have shown a small correlation to each other. On the other hand, systematic risk is the risk that Encore Wire's price will be affected by overall stock market movements and cannot be diversified away. So, no matter how many positions you have, you cannot eliminate market risk. However, you can measure a Encore stock's historical response to market movements and buy it if you are comfortable with its volatility direction. Beta and standard deviation are two commonly used measures to help you make the right decision. Given the investment horizon of 90 days the coefficient of variation of Encore Wire is 1448.73. The daily returns are distributed with a variance of 8.55 and standard deviation of 2.92. The mean deviation of Encore Wire is currently at 2.21. For similar time horizon, the selected benchmark (NYSE Composite) has volatility of 1.49

α | Alpha over NYSE Composite | 0.0479 | |

β | Beta against NYSE Composite | 1.17 | |

σ | Overall volatility | 2.92 | |

Ir | Information ratio | 0.021 |

## Encore Wire Stock Return Volatility

Encore Wire historical daily return volatility represents how much of Encore Wire stock's daily returns swing around its mean - it is a statistical measure of its dispersion of returns. The firm inherits 2.9239% risk (volatility on return distribution) over the 90 days horizon. By contrast, NYSE Composite accepts 1.5166% volatility on return distribution over the 90 days horizon. Performance (%) |

Timeline |

## About Encore Wire Volatility

Volatility is a rate at which the price of Encore Wire or any other equity instrument increases or decreases for a given set of returns. It is measured by calculating the standard deviation of the annualized returns over a given period of time and shows the range to which the price of Encore Wire may increase or decrease. In other words, similar to Encore's beta indicator, it measures the risk of Encore Wire and helps estimate the fluctuations that may happen in a short period of time. So if prices of Encore Wire fluctuate rapidly in a short time span, it is termed to have high volatility, and if it swings slowly in a more extended period, it is understood to have low volatility.

Please read more on our technical analysis page.Last Reported | Projected for 2022 | ||

Market Capitalization | 808.6 M | 652 M |

## Encore Wire Investment Opportunity

Encore Wire has a volatility of 2.92 and is 1.92 times more volatile than NYSE Composite.**25**of all equities and portfolios are less risky than Encore Wire. Compared to the overall equity markets, volatility of historical daily returns of Encore Wire is lower than

**25 ()**of all global equities and portfolios over the last 90 days. Use Encore Wire to protect your portfolios against small market fluctuations. Benchmarks are essential to demonstrate the utility of optimization algorithms. The stock experiences a very speculative upward sentiment. Check odds of Encore Wire to be traded at $131.83 in 90 days.

### Poor diversification

The correlation between Encore Wire and NYA is

**0.61**(i.e., Poor diversification) for selected investment horizon. Overlapping area represents the amount of risk that can be diversified away by holding Encore Wire and NYA in the same portfolio, assuming nothing else is changed.## Encore Wire Additional Risk Indicators

The analysis of Encore Wire's secondary risk indicators is one of the essential steps in making a buy or sell decision. The process involves identifying the amount of risk involved in Encore Wire's investment and either accepting that risk or mitigating it. Along with some common measures of Encore Wire stock's risk such as standard deviation, beta, or value at risk, we also provide a set of secondary indicators that can assist in the individual investment decision or help in hedging the risk of your existing portfolios.

Risk Adjusted Performance | 0.0784 | |||

Market Risk Adjusted Performance | 0.1222 | |||

Mean Deviation | 2.17 | |||

Semi Deviation | 2.95 | |||

Downside Deviation | 3.19 | |||

Coefficient Of Variation | 2031.74 | |||

Standard Deviation | 2.88 |

Please note, the risk measures we provide can be used independently or collectively to perform a risk assessment. When comparing two potential stocks, we recommend comparing similar stocks with homogenous growth potential and valuation from related markets to determine which investment holds the most risk.

## Encore Wire Suggested Diversification Pairs

Pair trading is one of the very effective strategies used by professional day traders and hedge funds capitalizing on short-time and mid-term market inefficiencies. The approach is based on the fact that the ratio of prices of two correlating shares is long-term stable and oscillates around the average value. If the correlation ratio comes outside the common area, you can speculate with a high success rate that the ratio will return to the mean value and collect a profit.

The effect of pair diversification on risk is to reduce it, but we should note this doesn't apply to all risk types. When we trade pairs against Encore Wire as a counterpart, there is always some inherent risk that will never be diversified away no matter what. This volatility limits the effect of tactical diversification using pair trading. Encore Wire's systematic risk is the inherent uncertainty of the entire market, and therefore cannot be mitigated even by pair-trading it against the equity that is not highly correlated to it. On the other hand, Encore Wire's unsystematic risk describes the types of risk that we can protect against, at least to some degree, by selecting a matching pair that is not perfectly correlated to Encore Wire.

Check out Your Current Watchlist. You can also try Equity Forecasting module to use basic forecasting models to generate price predictions and determine price momentum.

## Complementary Tools for analysis

When running Encore Wire price analysis, check to measure Encore Wire's market volatility, profitability, liquidity, solvency, efficiency, growth potential, financial leverage, and other vital indicators. We have many different tools that can be utilized to determine how healthy Encore Wire is operating at the current time. Most of Encore Wire's value examination focuses on studying past and present price action to predict the probability of Encore Wire's future price movements. You can analyze the entity against its peers and financial market as a whole to determine factors that move Encore Wire's price. Additionally, you may evaluate how the addition of Encore Wire to your portfolios can decrease your overall portfolio volatility.

Idea OptimizerUse advanced portfolio builder with pre-computed micro ideas to build optimal portfolio | Go | |

Stock TickersUse high-impact, comprehensive, and customizable stock tickers that can be easily integrated to any websites | Go | |

Idea BreakdownAnalyze constituents of all Macroaxis ideas. Macroaxis investment ideas are predefined, sector-focused investing themes | Go | |

Pattern RecognitionUse different Pattern Recognition models to time the market across multiple global exchanges | Go | |

Equity SearchSearch for actively traded equities including funds and ETFs from over 30 global markets | Go | |

ETF DirectoryFind actively traded Exchange Traded Funds (ETF) from around the world | Go | |

Equity AnalysisResearch over 250,000 global equities including funds, stocks and ETFs to find investment opportunities | Go | |

Bollinger BandsUse Bollinger Bands indicator to analyze target price for a given investing horizon | Go | |

Bond AnalysisEvaluate and analyze corporate bonds as a potential investment for your portfolios. | Go | |

Options AnalysisAnalyze and evaluate options and option chains as a potential hedge for your portfolios | Go | |

Instant RatingsDetermine any equity ratings based on digital recommendations. Macroaxis instant equity ratings are based on combination of fundamental analysis and risk-adjusted market performance | Go | |

Efficient FrontierPlot and analyze your portfolio and positions against risk-return landscape of the market. | Go |

Is Encore Wire's industry expected to grow? Or is there an opportunity to expand the business' product line in the future? Factors like these will boost the valuation of Encore Wire. If investors know Encore will grow in the future, the company's valuation will be higher. The financial industry is built on trying to define current growth potential and future valuation accurately. All the valuation information about Encore Wire listed above have to be considered, but the key to understanding future value is determining which factors weigh more heavily than others.

Quarterly Earnings Growth YOY 0.17 | Market Capitalization 2.7 B | Quarterly Revenue Growth YOY 0.064 | Return On Assets 0.35 | Return On Equity 0.49 |

The market value of Encore Wire is measured differently than its book value, which is the value of Encore that is recorded on the company's balance sheet. Investors also form their own opinion of Encore Wire's value that differs from its market value or its book value, called intrinsic value, which is Encore Wire's true underlying value. Investors use various methods to calculate intrinsic value and buy a stock when its market value falls below its intrinsic value. Because Encore Wire's market value can be influenced by many factors that don't directly affect Encore Wire's underlying business (such as a pandemic or basic market pessimism), market value can vary widely from intrinsic value.

Please note, there is a significant difference between Encore Wire's value and its price as these two are different measures arrived at by different means. Investors typically determine Encore Wire value by looking at such factors as earnings, sales, fundamental and technical indicators, competition as well as analyst projections. However, Encore Wire's price is the amount at which it trades on the open market and represents the number that a seller and buyer find agreeable to each party.