Correlation Between Hollywood Bowl and PHN Frankfurt
Can any of the company-specific risk be diversified away by investing in both Hollywood Bowl and PHN Frankfurt 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 Hollywood Bowl and PHN Frankfurt into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Hollywood Bowl Group and PHN Frankfurt, you can compare the effects of market volatilities on Hollywood Bowl and PHN Frankfurt 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 Hollywood Bowl with a short position of PHN Frankfurt. Check out your portfolio center. Please also check ongoing floating volatility patterns of Hollywood Bowl and PHN Frankfurt.
Diversification Opportunities for Hollywood Bowl and PHN Frankfurt
-0.51 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between Hollywood and PHN is -0.51. Overlapping area represents the amount of risk that can be diversified away by holding Hollywood Bowl Group and PHN Frankfurt in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on PHN Frankfurt and Hollywood Bowl 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 Hollywood Bowl Group are associated (or correlated) with PHN Frankfurt. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of PHN Frankfurt has no effect on the direction of Hollywood Bowl i.e., Hollywood Bowl and PHN Frankfurt go up and down completely randomly.
Pair Corralation between Hollywood Bowl and PHN Frankfurt
Assuming the 90 days horizon Hollywood Bowl Group is expected to generate 0.72 times more return on investment than PHN Frankfurt. However, Hollywood Bowl Group is 1.38 times less risky than PHN Frankfurt. It trades about 0.11 of its potential returns per unit of risk. PHN Frankfurt is currently generating about 0.01 per unit of risk. If you would invest 384.00 in Hollywood Bowl Group on September 12, 2024 and sell it today you would earn a total of 12.00 from holding Hollywood Bowl Group or generate 3.13% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 95.65% |
| Values | Daily Returns |
Hollywood Bowl Group vs. PHN Frankfurt
Performance |
| Timeline |
| Hollywood Bowl Group |
| PHN Frankfurt |
Hollywood Bowl and PHN Frankfurt Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Hollywood Bowl and PHN Frankfurt
The main advantage of trading using opposite Hollywood Bowl and PHN Frankfurt positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Hollywood Bowl position performs unexpectedly, PHN Frankfurt 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 PHN Frankfurt will offset losses from the drop in PHN Frankfurt's long position.| Hollywood Bowl vs. Superior Plus Corp | Hollywood Bowl vs. SIVERS SEMICONDUCTORS AB | Hollywood Bowl vs. Norsk Hydro ASA | Hollywood Bowl vs. Reliance Steel Aluminum |
| PHN Frankfurt vs. Westinghouse Air Brake | PHN Frankfurt vs. JIAHUA STORES | PHN Frankfurt vs. Alaska Air Group | PHN Frankfurt vs. ETFS Coffee ETC |
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 Efficient Frontier module to plot and analyze your portfolio and positions against risk-return landscape of the market..
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