Correlation Between HIM International and Trade Van
Can any of the company-specific risk be diversified away by investing in both HIM International and Trade Van 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 Trade Van 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 Trade Van Information Services, you can compare the effects of market volatilities on HIM International and Trade Van 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 Trade Van. Check out your portfolio center. Please also check ongoing floating volatility patterns of HIM International and Trade Van.
Diversification Opportunities for HIM International and Trade Van
0.72 | Correlation Coefficient |
Poor diversification
The 3 months correlation between HIM and Trade is 0.72. Overlapping area represents the amount of risk that can be diversified away by holding HIM International Music and Trade Van Information Services in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Trade Van Information 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 Trade Van. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Trade Van Information has no effect on the direction of HIM International i.e., HIM International and Trade Van go up and down completely randomly.
Pair Corralation between HIM International and Trade Van
Assuming the 90 days trading horizon HIM International Music is expected to generate 1.48 times more return on investment than Trade Van. However, HIM International is 1.48 times more volatile than Trade Van Information Services. It trades about 0.07 of its potential returns per unit of risk. Trade Van Information Services is currently generating about 0.04 per unit of risk. If you would invest 12,000 in HIM International Music on September 2, 2024 and sell it today you would earn a total of 250.00 from holding HIM International Music or generate 2.08% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
HIM International Music vs. Trade Van Information Services
Performance |
| Timeline |
| HIM International Music |
| Trade Van Information |
HIM International and Trade Van Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with HIM International and Trade Van
The main advantage of trading using opposite HIM International and Trade Van positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if HIM International position performs unexpectedly, Trade Van 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 Trade Van will offset losses from the drop in Trade Van's long position.| HIM International vs. Cameo Communications | HIM International vs. Nova Technology | HIM International vs. TWOWAY Communications | HIM International vs. Asmedia Technology |
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 Cryptocurrency Center module to build and monitor diversified portfolio of extremely risky digital assets and cryptocurrency.
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