Correlation Between HIM International and Louisa Professional
Can any of the company-specific risk be diversified away by investing in both HIM International and Louisa Professional 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 HIM International and Louisa Professional into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between HIM International Music and Louisa Professional Coffee, you can compare the effects of market volatilities on HIM International and Louisa Professional 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 HIM International with a short position of Louisa Professional. Check out your portfolio center. Please also check ongoing floating volatility patterns of HIM International and Louisa Professional.
Diversification Opportunities for HIM International and Louisa Professional
-0.58 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between HIM and Louisa is -0.58. Overlapping area represents the amount of risk that can be diversified away by holding HIM International Music and Louisa Professional Coffee in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Louisa Professional and HIM International 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 HIM International Music are associated (or correlated) with Louisa Professional. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Louisa Professional has no effect on the direction of HIM International i.e., HIM International and Louisa Professional go up and down completely randomly.
Pair Corralation between HIM International and Louisa Professional
Assuming the 90 days trading horizon HIM International Music is expected to generate 1.34 times more return on investment than Louisa Professional. However, HIM International is 1.34 times more volatile than Louisa Professional Coffee. It trades about 0.04 of its potential returns per unit of risk. Louisa Professional Coffee is currently generating about -0.4 per unit of risk. If you would invest 12,100 in HIM International Music on September 3, 2024 and sell it today you would earn a total of 150.00 from holding HIM International Music or generate 1.24% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
HIM International Music vs. Louisa Professional Coffee
Performance |
| Timeline |
| HIM International Music |
| Louisa Professional |
HIM International and Louisa Professional Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with HIM International and Louisa Professional
The main advantage of trading using opposite HIM International and Louisa Professional positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if HIM International position performs unexpectedly, Louisa Professional 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 Louisa Professional will offset losses from the drop in Louisa Professional's long position.| HIM International vs. Symtek Automation Asia | HIM International vs. WiseChip Semiconductor | HIM International vs. Novatek Microelectronics Corp | HIM International vs. Tanvex BioPharma |
| Louisa Professional vs. Hi Lai Foods Co | Louisa Professional vs. Ruentex Development Co | Louisa Professional vs. Symtek Automation Asia | Louisa Professional vs. CTCI Corp |
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 Global Correlations module to find global opportunities by holding instruments from different markets.
Other Complementary Tools
| Alpha Finder Use alpha and beta coefficients to find investment opportunities after accounting for the risk | |
| Earnings Calls Check upcoming earnings announcements updated hourly across public exchanges | |
| Price Ceiling Movement Calculate and plot Price Ceiling Movement for different equity instruments | |
| Stock Screener Find equities using a custom stock filter or screen asymmetry in trading patterns, price, volume, or investment outlook. | |
| Portfolio Manager State of the art Portfolio Manager to monitor and improve performance of your invested capital |