Correlation Between Hua Hong and Hollywood Bowl
Can any of the company-specific risk be diversified away by investing in both Hua Hong and Hollywood Bowl 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 Hua Hong and Hollywood Bowl into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Hua Hong Semiconductor and Hollywood Bowl Group, you can compare the effects of market volatilities on Hua Hong and Hollywood Bowl 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 Hua Hong with a short position of Hollywood Bowl. Check out your portfolio center. Please also check ongoing floating volatility patterns of Hua Hong and Hollywood Bowl.
Diversification Opportunities for Hua Hong and Hollywood Bowl
-0.23 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Hua and Hollywood is -0.23. Overlapping area represents the amount of risk that can be diversified away by holding Hua Hong Semiconductor and Hollywood Bowl Group in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Hollywood Bowl Group and Hua Hong 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 Hua Hong Semiconductor are associated (or correlated) with Hollywood Bowl. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Hollywood Bowl Group has no effect on the direction of Hua Hong i.e., Hua Hong and Hollywood Bowl go up and down completely randomly.
Pair Corralation between Hua Hong and Hollywood Bowl
Assuming the 90 days horizon Hua Hong Semiconductor is expected to generate 1.66 times more return on investment than Hollywood Bowl. However, Hua Hong is 1.66 times more volatile than Hollywood Bowl Group. It trades about 0.19 of its potential returns per unit of risk. Hollywood Bowl Group is currently generating about -0.23 per unit of risk. If you would invest 262.00 in Hua Hong Semiconductor on October 24, 2024 and sell it today you would earn a total of 30.00 from holding Hua Hong Semiconductor or generate 11.45% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Hua Hong Semiconductor vs. Hollywood Bowl Group
Performance |
| Timeline |
| Hua Hong Semiconductor |
| Hollywood Bowl Group |
Hua Hong and Hollywood Bowl Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Hua Hong and Hollywood Bowl
The main advantage of trading using opposite Hua Hong and Hollywood Bowl positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Hua Hong position performs unexpectedly, Hollywood Bowl 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 Hollywood Bowl will offset losses from the drop in Hollywood Bowl's long position.| Hua Hong vs. NVIDIA | Hua Hong vs. NVIDIA | Hua Hong vs. Taiwan Semiconductor Manufacturing | Hua Hong vs. Broadcom |
| Hollywood Bowl vs. SIERRA METALS | Hollywood Bowl vs. Tencent Music Entertainment | Hollywood Bowl vs. Fuji Media Holdings | Hollywood Bowl vs. ANTA SPORTS PRODUCT |
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 Idea Breakdown module to analyze constituents of all Macroaxis ideas. Macroaxis investment ideas are predefined, sector-focused investing themes.
Other Complementary Tools
| Bond Analysis Evaluate and analyze corporate bonds as a potential investment for your portfolios. | |
| Global Correlations Find global opportunities by holding instruments from different markets | |
| Portfolio Holdings Check your current holdings and cash postion to detemine if your portfolio needs rebalancing | |
| Stock Tickers Use high-impact, comprehensive, and customizable stock tickers that can be easily integrated to any websites | |
| Portfolio Dashboard Portfolio dashboard that provides centralized access to all your investments |