Correlation Between Est Global and HIM International
Can any of the company-specific risk be diversified away by investing in both Est Global and HIM International 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 Est Global and HIM International into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Est Global Apparel and HIM International Music, you can compare the effects of market volatilities on Est Global and HIM International 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 Est Global with a short position of HIM International. Check out your portfolio center. Please also check ongoing floating volatility patterns of Est Global and HIM International.
Diversification Opportunities for Est Global and HIM International
0.26 | Correlation Coefficient |
Modest diversification
The 3 months correlation between Est and HIM is 0.26. Overlapping area represents the amount of risk that can be diversified away by holding Est Global Apparel and HIM International Music in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on HIM International Music and Est Global 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 Est Global Apparel are associated (or correlated) with HIM International. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of HIM International Music has no effect on the direction of Est Global i.e., Est Global and HIM International go up and down completely randomly.
Pair Corralation between Est Global and HIM International
Assuming the 90 days trading horizon Est Global is expected to generate 1.95 times less return on investment than HIM International. In addition to that, Est Global is 1.47 times more volatile than HIM International Music. It trades about 0.02 of its total potential returns per unit of risk. HIM International Music is currently generating about 0.06 per unit of volatility. If you would invest 7,421 in HIM International Music on October 13, 2024 and sell it today you would earn a total of 4,229 from holding HIM International Music or generate 56.99% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 99.79% |
| Values | Daily Returns |
Est Global Apparel vs. HIM International Music
Performance |
| Timeline |
| Est Global Apparel |
| HIM International Music |
Est Global and HIM International Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Est Global and HIM International
The main advantage of trading using opposite Est Global and HIM International positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Est Global position performs unexpectedly, HIM International 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 HIM International will offset losses from the drop in HIM International's long position.| Est Global vs. Wei Chuan Foods | Est Global vs. Hunya Foods Co | Est Global vs. Tradetool Auto Co | Est Global vs. TWOWAY Communications |
| HIM International vs. Everlight Electronics Co | HIM International vs. Sea Sonic Electronics | HIM International vs. Universal Microelectronics Co | HIM International vs. Loop Telecommunication 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 Odds Of Bankruptcy module to get analysis of equity chance of financial distress in the next 2 years.
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