Correlation Between Hollywood Bowl and Natural Health
Can any of the company-specific risk be diversified away by investing in both Hollywood Bowl and Natural Health 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 Natural Health 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 Natural Health Trends, you can compare the effects of market volatilities on Hollywood Bowl and Natural Health 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 Natural Health. Check out your portfolio center. Please also check ongoing floating volatility patterns of Hollywood Bowl and Natural Health.
Diversification Opportunities for Hollywood Bowl and Natural Health
0.01 | Correlation Coefficient |
Significant diversification
The 3 months correlation between Hollywood and Natural is 0.01. Overlapping area represents the amount of risk that can be diversified away by holding Hollywood Bowl Group and Natural Health Trends in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Natural Health Trends 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 Natural Health. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Natural Health Trends has no effect on the direction of Hollywood Bowl i.e., Hollywood Bowl and Natural Health go up and down completely randomly.
Pair Corralation between Hollywood Bowl and Natural Health
Assuming the 90 days horizon Hollywood Bowl Group is expected to generate 0.84 times more return on investment than Natural Health. However, Hollywood Bowl Group is 1.19 times less risky than Natural Health. It trades about -0.01 of its potential returns per unit of risk. Natural Health Trends is currently generating about -0.03 per unit of risk. If you would invest 396.00 in Hollywood Bowl Group on September 3, 2024 and sell it today you would lose (18.00) from holding Hollywood Bowl Group or give up 4.55% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Hollywood Bowl Group vs. Natural Health Trends
Performance |
| Timeline |
| Hollywood Bowl Group |
| Natural Health Trends |
Hollywood Bowl and Natural Health Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Hollywood Bowl and Natural Health
The main advantage of trading using opposite Hollywood Bowl and Natural Health positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Hollywood Bowl position performs unexpectedly, Natural Health 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 Natural Health will offset losses from the drop in Natural Health's long position.| Hollywood Bowl vs. ECHO INVESTMENT ZY | Hollywood Bowl vs. SPORTING | Hollywood Bowl vs. New Residential Investment | Hollywood Bowl vs. MGIC INVESTMENT |
| Natural Health vs. CITY OFFICE REIT | Natural Health vs. WillScot Mobile Mini | Natural Health vs. KIMBALL ELECTRONICS | Natural Health vs. ELECTRONIC ARTS |
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 Stocks Directory module to find actively traded stocks across global markets.
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