Correlation Between HF FOODS and Aristocrat Leisure
Can any of the company-specific risk be diversified away by investing in both HF FOODS and Aristocrat Leisure 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 HF FOODS and Aristocrat Leisure into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between HF FOODS GRP and Aristocrat Leisure Limited, you can compare the effects of market volatilities on HF FOODS and Aristocrat Leisure 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 HF FOODS with a short position of Aristocrat Leisure. Check out your portfolio center. Please also check ongoing floating volatility patterns of HF FOODS and Aristocrat Leisure.
Diversification Opportunities for HF FOODS and Aristocrat Leisure
0.14 | Correlation Coefficient |
Average diversification
The 3 months correlation between 3GX and Aristocrat is 0.14. Overlapping area represents the amount of risk that can be diversified away by holding HF FOODS GRP and Aristocrat Leisure Limited in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Aristocrat Leisure and HF FOODS 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 HF FOODS GRP are associated (or correlated) with Aristocrat Leisure. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Aristocrat Leisure has no effect on the direction of HF FOODS i.e., HF FOODS and Aristocrat Leisure go up and down completely randomly.
Pair Corralation between HF FOODS and Aristocrat Leisure
Assuming the 90 days horizon HF FOODS GRP is expected to under-perform the Aristocrat Leisure. In addition to that, HF FOODS is 1.87 times more volatile than Aristocrat Leisure Limited. It trades about -0.43 of its total potential returns per unit of risk. Aristocrat Leisure Limited is currently generating about 0.26 per unit of volatility. If you would invest 4,080 in Aristocrat Leisure Limited on October 20, 2024 and sell it today you would earn a total of 200.00 from holding Aristocrat Leisure Limited or generate 4.9% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 94.44% |
| Values | Daily Returns |
HF FOODS GRP vs. Aristocrat Leisure Limited
Performance |
| Timeline |
| HF FOODS GRP |
| Aristocrat Leisure |
HF FOODS and Aristocrat Leisure Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with HF FOODS and Aristocrat Leisure
The main advantage of trading using opposite HF FOODS and Aristocrat Leisure positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if HF FOODS position performs unexpectedly, Aristocrat Leisure 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 Aristocrat Leisure will offset losses from the drop in Aristocrat Leisure's long position.| HF FOODS vs. Mitsui Chemicals | HF FOODS vs. Silicon Motion Technology | HF FOODS vs. Sanyo Chemical Industries | HF FOODS vs. INDO RAMA SYNTHETIC |
| Aristocrat Leisure vs. Nintendo Co | Aristocrat Leisure vs. Nintendo Co | Aristocrat Leisure vs. Sea Limited | Aristocrat Leisure 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 Piotroski F Score module to get Piotroski F Score based on the binary analysis strategy of nine different fundamentals.
Other Complementary Tools
| Insider Screener Find insiders across different sectors to evaluate their impact on performance | |
| Piotroski F Score Get Piotroski F Score based on the binary analysis strategy of nine different fundamentals | |
| Equity Forecasting Use basic forecasting models to generate price predictions and determine price momentum | |
| Premium Stories Follow Macroaxis premium stories from verified contributors across different equity types, categories and coverage scope | |
| Options Analysis Analyze and evaluate options and option chains as a potential hedge for your portfolios |