Correlation Between High Liner and LVMH Moët
Can any of the company-specific risk be diversified away by investing in both High Liner and LVMH Moët 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 High Liner and LVMH Moët into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between High Liner Foods and LVMH Mot Hennessy, you can compare the effects of market volatilities on High Liner and LVMH Moët 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 High Liner with a short position of LVMH Moët. Check out your portfolio center. Please also check ongoing floating volatility patterns of High Liner and LVMH Moët.
Diversification Opportunities for High Liner and LVMH Moët
0.44 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between High and LVMH is 0.44. Overlapping area represents the amount of risk that can be diversified away by holding High Liner Foods and LVMH Mot Hennessy in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on LVMH Mot Hennessy and High Liner 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 High Liner Foods are associated (or correlated) with LVMH Moët. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of LVMH Mot Hennessy has no effect on the direction of High Liner i.e., High Liner and LVMH Moët go up and down completely randomly.
Pair Corralation between High Liner and LVMH Moët
Assuming the 90 days horizon High Liner Foods is expected to generate 1.05 times more return on investment than LVMH Moët. However, High Liner is 1.05 times more volatile than LVMH Mot Hennessy. It trades about 0.15 of its potential returns per unit of risk. LVMH Mot Hennessy is currently generating about 0.09 per unit of risk. If you would invest 826.00 in High Liner Foods on November 6, 2024 and sell it today you would earn a total of 204.00 from holding High Liner Foods or generate 24.7% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
High Liner Foods vs. LVMH Mot Hennessy
Performance |
| Timeline |
| High Liner Foods |
| LVMH Mot Hennessy |
High Liner and LVMH Moët Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with High Liner and LVMH Moët
The main advantage of trading using opposite High Liner and LVMH Moët positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if High Liner position performs unexpectedly, LVMH Moët 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 LVMH Moët will offset losses from the drop in LVMH Moët's long position.| High Liner vs. alstria office REIT AG | High Liner vs. Reinsurance Group of | High Liner vs. AGNC INVESTMENT | High Liner vs. Infrastrutture Wireless Italiane |
| LVMH Moët vs. LVMH Mot Hennessy | LVMH Moët vs. LVMH Mot Hennessy | LVMH Moët vs. Herms International Socit | LVMH Moët vs. CHRISTIAN DIOR ADR14EO2 |
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 Dashboard module to portfolio dashboard that provides centralized access to all your investments.
Other Complementary Tools
| Portfolio Anywhere Track or share privately all of your investments from the convenience of any device | |
| Idea Analyzer Analyze all characteristics, volatility and risk-adjusted return of Macroaxis ideas | |
| Content Syndication Quickly integrate customizable finance content to your own investment portal | |
| Odds Of Bankruptcy Get analysis of equity chance of financial distress in the next 2 years | |
| Portfolio Comparator Compare the composition, asset allocations and performance of any two portfolios in your account |