Correlation Between National Bank and Hilton Food
Can any of the company-specific risk be diversified away by investing in both National Bank 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 National Bank and Hilton Food into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between National Bank of and Hilton Food Group, you can compare the effects of market volatilities on National Bank 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 National Bank with a short position of Hilton Food. Check out your portfolio center. Please also check ongoing floating volatility patterns of National Bank and Hilton Food.
Diversification Opportunities for National Bank and Hilton Food
0.0 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between National and Hilton is 0.0. Overlapping area represents the amount of risk that can be diversified away by holding National Bank of 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 National Bank 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 National Bank of 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 National Bank i.e., National Bank and Hilton Food go up and down completely randomly.
Pair Corralation between National Bank and Hilton Food
Assuming the 90 days trading horizon National Bank is expected to generate 1.91 times less return on investment than Hilton Food. But when comparing it to its historical volatility, National Bank of is 1.18 times less risky than Hilton Food. It trades about 0.03 of its potential returns per unit of risk. Hilton Food Group is currently generating about 0.06 of returns per unit of risk over similar time horizon. If you would invest 67,293 in Hilton Food Group on September 19, 2024 and sell it today you would earn a total of 22,407 from holding Hilton Food Group or generate 33.3% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Flat |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
National Bank of vs. Hilton Food Group
Performance |
| Timeline |
| National Bank |
| Hilton Food Group |
National Bank and Hilton Food Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with National Bank and Hilton Food
The main advantage of trading using opposite National Bank and Hilton Food positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if National Bank 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.| National Bank vs. Samsung Electronics Co | National Bank vs. Samsung Electronics Co | National Bank vs. Hyundai Motor | National Bank vs. Reliance Industries Ltd |
| Hilton Food vs. Amedeo Air Four | Hilton Food vs. Monster Beverage Corp | Hilton Food vs. Finnair Oyj | Hilton Food vs. Sealed Air Corp |
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 Sign In To Macroaxis module to sign in to explore Macroaxis' wealth optimization platform and fintech modules.
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