Correlation Between Haitong Securities and Darden Restaurants
Can any of the company-specific risk be diversified away by investing in both Haitong Securities and Darden Restaurants 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 Haitong Securities and Darden Restaurants into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Haitong Securities Co and Darden Restaurants, you can compare the effects of market volatilities on Haitong Securities and Darden Restaurants 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 Haitong Securities with a short position of Darden Restaurants. Check out your portfolio center. Please also check ongoing floating volatility patterns of Haitong Securities and Darden Restaurants.
Diversification Opportunities for Haitong Securities and Darden Restaurants
0.7 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Haitong and Darden is 0.7. Overlapping area represents the amount of risk that can be diversified away by holding Haitong Securities Co and Darden Restaurants in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Darden Restaurants and Haitong Securities 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 Haitong Securities Co are associated (or correlated) with Darden Restaurants. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Darden Restaurants has no effect on the direction of Haitong Securities i.e., Haitong Securities and Darden Restaurants go up and down completely randomly.
Pair Corralation between Haitong Securities and Darden Restaurants
Assuming the 90 days horizon Haitong Securities Co is expected to generate 4.11 times more return on investment than Darden Restaurants. However, Haitong Securities is 4.11 times more volatile than Darden Restaurants. It trades about 0.06 of its potential returns per unit of risk. Darden Restaurants is currently generating about 0.02 per unit of risk. If you would invest 41.00 in Haitong Securities Co on September 12, 2024 and sell it today you would earn a total of 46.00 from holding Haitong Securities Co or generate 112.2% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 99.72% |
| Values | Daily Returns |
Haitong Securities Co vs. Darden Restaurants
Performance |
| Timeline |
| Haitong Securities |
| Darden Restaurants |
Haitong Securities and Darden Restaurants Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Haitong Securities and Darden Restaurants
The main advantage of trading using opposite Haitong Securities and Darden Restaurants positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Haitong Securities position performs unexpectedly, Darden Restaurants 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 Darden Restaurants will offset losses from the drop in Darden Restaurants' long position.| Haitong Securities vs. Summit Materials | Haitong Securities vs. Luckin Coffee | Haitong Securities vs. PRECISION DRILLING P | Haitong Securities vs. BORR DRILLING NEW |
| Darden Restaurants vs. Nucletron Electronic Aktiengesellschaft | Darden Restaurants vs. LPKF Laser Electronics | Darden Restaurants vs. PROSIEBENSAT1 MEDIADR4 | Darden Restaurants vs. METHODE ELECTRONICS |
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 Portfolio Optimization module to compute new portfolio that will generate highest expected return given your specified tolerance for risk.
Other Complementary Tools
| Stock Tickers Use high-impact, comprehensive, and customizable stock tickers that can be easily integrated to any websites | |
| CEOs Directory Screen CEOs from public companies around the world | |
| Watchlist Optimization Optimize watchlists to build efficient portfolios or rebalance existing positions based on the mean-variance optimization algorithm | |
| Sync Your Broker Sync your existing holdings, watchlists, positions or portfolios from thousands of online brokerage services, banks, investment account aggregators and robo-advisors. | |
| Equity Analysis Research over 250,000 global equities including funds, stocks and ETFs to find investment opportunities |