Correlation Between Haier Smart and Gentex
Can any of the company-specific risk be diversified away by investing in both Haier Smart and Gentex 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 Haier Smart and Gentex into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Haier Smart Home and Gentex, you can compare the effects of market volatilities on Haier Smart and Gentex 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 Haier Smart with a short position of Gentex. Check out your portfolio center. Please also check ongoing floating volatility patterns of Haier Smart and Gentex.
Diversification Opportunities for Haier Smart and Gentex
-0.56 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between Haier and Gentex is -0.56. Overlapping area represents the amount of risk that can be diversified away by holding Haier Smart Home and Gentex in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Gentex and Haier Smart 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 Haier Smart Home are associated (or correlated) with Gentex. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Gentex has no effect on the direction of Haier Smart i.e., Haier Smart and Gentex go up and down completely randomly.
Pair Corralation between Haier Smart and Gentex
Assuming the 90 days trading horizon Haier Smart Home is expected to generate 1.65 times more return on investment than Gentex. However, Haier Smart is 1.65 times more volatile than Gentex. It trades about 0.05 of its potential returns per unit of risk. Gentex is currently generating about -0.48 per unit of risk. If you would invest 178.00 in Haier Smart Home on October 11, 2024 and sell it today you would earn a total of 2.00 from holding Haier Smart Home or generate 1.12% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Haier Smart Home vs. Gentex
Performance |
| Timeline |
| Haier Smart Home |
| Gentex |
Haier Smart and Gentex Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Haier Smart and Gentex
The main advantage of trading using opposite Haier Smart and Gentex positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Haier Smart position performs unexpectedly, Gentex 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 Gentex will offset losses from the drop in Gentex's long position.| Haier Smart vs. American Homes 4 | Haier Smart vs. ADDUS HOMECARE | Haier Smart vs. GREENX METALS LTD | Haier Smart vs. CITY OFFICE REIT |
| Gentex vs. GBS Software AG | Gentex vs. MOLSON RS BEVERAGE | Gentex vs. CN MODERN DAIRY | Gentex vs. AXWAY SOFTWARE EO |
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 Equity Search module to search for actively traded equities including funds and ETFs from over 30 global markets.
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