Correlation Between NOV and Hilton Food
Can any of the company-specific risk be diversified away by investing in both NOV and Hilton Food 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 NOV and Hilton Food into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between NOV Inc and Hilton Food Group, you can compare the effects of market volatilities on NOV and Hilton Food 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 NOV with a short position of Hilton Food. Check out your portfolio center. Please also check ongoing floating volatility patterns of NOV and Hilton Food.
Diversification Opportunities for NOV and Hilton Food
0.22 | Correlation Coefficient |
Modest diversification
The 3 months correlation between NOV and Hilton is 0.22. Overlapping area represents the amount of risk that can be diversified away by holding NOV Inc and Hilton Food Group in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Hilton Food Group and NOV 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 NOV Inc are associated (or correlated) with Hilton Food. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Hilton Food Group has no effect on the direction of NOV i.e., NOV and Hilton Food go up and down completely randomly.
Pair Corralation between NOV and Hilton Food
Assuming the 90 days trading horizon NOV Inc is expected to generate 0.08 times more return on investment than Hilton Food. However, NOV Inc is 12.9 times less risky than Hilton Food. It trades about 0.21 of its potential returns per unit of risk. Hilton Food Group is currently generating about -0.07 per unit of risk. If you would invest 1,593 in NOV Inc on September 13, 2024 and sell it today you would earn a total of 7.00 from holding NOV Inc or generate 0.44% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
NOV Inc vs. Hilton Food Group
Performance |
| Timeline |
| NOV Inc |
| Hilton Food Group |
NOV and Hilton Food Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with NOV and Hilton Food
The main advantage of trading using opposite NOV and Hilton Food positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if NOV position performs unexpectedly, Hilton Food 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 Hilton Food will offset losses from the drop in Hilton Food's long position.| NOV vs. Datagroup SE | NOV vs. Fevertree Drinks Plc | NOV vs. Air Products Chemicals | NOV vs. Ion Beam Applications |
| Hilton Food vs. MTI Wireless Edge | Hilton Food vs. AcadeMedia AB | Hilton Food vs. Fonix Mobile plc | Hilton Food vs. mobilezone holding AG |
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 Portfolio Center module to all portfolio management and optimization tools to improve performance of your portfolios.
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