Correlation Between Hollywood Bowl and Transportadora
Can any of the company-specific risk be diversified away by investing in both Hollywood Bowl and Transportadora 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 Transportadora 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 Transportadora de Gas, you can compare the effects of market volatilities on Hollywood Bowl and Transportadora 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 Transportadora. Check out your portfolio center. Please also check ongoing floating volatility patterns of Hollywood Bowl and Transportadora.
Diversification Opportunities for Hollywood Bowl and Transportadora
0.31 | Correlation Coefficient |
Weak diversification
The 3 months correlation between Hollywood and Transportadora is 0.31. Overlapping area represents the amount of risk that can be diversified away by holding Hollywood Bowl Group and Transportadora de Gas in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Transportadora de Gas 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 Transportadora. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Transportadora de Gas has no effect on the direction of Hollywood Bowl i.e., Hollywood Bowl and Transportadora go up and down completely randomly.
Pair Corralation between Hollywood Bowl and Transportadora
Assuming the 90 days horizon Hollywood Bowl is expected to generate 12.26 times less return on investment than Transportadora. But when comparing it to its historical volatility, Hollywood Bowl Group is 4.51 times less risky than Transportadora. It trades about 0.1 of its potential returns per unit of risk. Transportadora de Gas is currently generating about 0.27 of returns per unit of risk over similar time horizon. If you would invest 2,020 in Transportadora de Gas on September 4, 2024 and sell it today you would earn a total of 740.00 from holding Transportadora de Gas or generate 36.63% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Hollywood Bowl Group vs. Transportadora de Gas
Performance |
| Timeline |
| Hollywood Bowl Group |
| Transportadora de Gas |
Hollywood Bowl and Transportadora Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Hollywood Bowl and Transportadora
The main advantage of trading using opposite Hollywood Bowl and Transportadora positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Hollywood Bowl position performs unexpectedly, Transportadora 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 Transportadora will offset losses from the drop in Transportadora's long position.| Hollywood Bowl vs. Li Ning Company | Hollywood Bowl vs. SHIMANO INC UNSPADR10 | Hollywood Bowl vs. Superior Plus Corp | Hollywood Bowl vs. NMI Holdings |
| Transportadora vs. ACCSYS TECHPLC EO | Transportadora vs. Hollywood Bowl Group | Transportadora vs. Siamgas And Petrochemicals | Transportadora vs. Universal Entertainment |
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 Price Transformation module to use Price Transformation models to analyze the depth of different equity instruments across global markets.
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