Correlation Between Postal Savings and Hexcel
Can any of the company-specific risk be diversified away by investing in both Postal Savings and Hexcel 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 Postal Savings and Hexcel into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Postal Savings Bank and Hexcel, you can compare the effects of market volatilities on Postal Savings and Hexcel 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 Postal Savings with a short position of Hexcel. Check out your portfolio center. Please also check ongoing floating volatility patterns of Postal Savings and Hexcel.
Diversification Opportunities for Postal Savings and Hexcel
0.24 | Correlation Coefficient |
Modest diversification
The 3 months correlation between Postal and Hexcel is 0.24. Overlapping area represents the amount of risk that can be diversified away by holding Postal Savings Bank and Hexcel in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Hexcel and Postal Savings 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 Postal Savings Bank are associated (or correlated) with Hexcel. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Hexcel has no effect on the direction of Postal Savings i.e., Postal Savings and Hexcel go up and down completely randomly.
Pair Corralation between Postal Savings and Hexcel
Assuming the 90 days horizon Postal Savings is expected to generate 2.66 times less return on investment than Hexcel. But when comparing it to its historical volatility, Postal Savings Bank is 1.27 times less risky than Hexcel. It trades about 0.08 of its potential returns per unit of risk. Hexcel is currently generating about 0.16 of returns per unit of risk over similar time horizon. If you would invest 5,700 in Hexcel on September 13, 2024 and sell it today you would earn a total of 300.00 from holding Hexcel or generate 5.26% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Postal Savings Bank vs. Hexcel
Performance |
| Timeline |
| Postal Savings Bank |
| Hexcel |
Postal Savings and Hexcel Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Postal Savings and Hexcel
The main advantage of trading using opposite Postal Savings and Hexcel positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Postal Savings position performs unexpectedly, Hexcel 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 Hexcel will offset losses from the drop in Hexcel's long position.| Postal Savings vs. POSBO UNSPADRS20YC1 | Postal Savings vs. UTD OV BK LOC ADR1 | Postal Savings vs. Superior Plus Corp | Postal Savings vs. SIVERS SEMICONDUCTORS AB |
| Hexcel vs. Verizon Communications | Hexcel vs. Iridium Communications | Hexcel vs. CHINA TELECOM H | Hexcel vs. Citic Telecom International |
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 Premium Stories module to follow Macroaxis premium stories from verified contributors across different equity types, categories and coverage scope.
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