Correlation Between Ads Tec and Hayward Holdings
Can any of the company-specific risk be diversified away by investing in both Ads Tec and Hayward Holdings 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 Ads Tec and Hayward Holdings into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Ads Tec Energy and Hayward Holdings, you can compare the effects of market volatilities on Ads Tec and Hayward Holdings 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 Ads Tec with a short position of Hayward Holdings. Check out your portfolio center. Please also check ongoing floating volatility patterns of Ads Tec and Hayward Holdings.
Diversification Opportunities for Ads Tec and Hayward Holdings
0.52 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Ads and Hayward is 0.52. Overlapping area represents the amount of risk that can be diversified away by holding Ads Tec Energy and Hayward Holdings in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Hayward Holdings and Ads Tec 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 Ads Tec Energy are associated (or correlated) with Hayward Holdings. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Hayward Holdings has no effect on the direction of Ads Tec i.e., Ads Tec and Hayward Holdings go up and down completely randomly.
Pair Corralation between Ads Tec and Hayward Holdings
Given the investment horizon of 90 days Ads Tec Energy is expected to under-perform the Hayward Holdings. But the stock apears to be less risky and, when comparing its historical volatility, Ads Tec Energy is 1.32 times less risky than Hayward Holdings. The stock trades about -0.15 of its potential returns per unit of risk. The Hayward Holdings is currently generating about 0.2 of returns per unit of risk over similar time horizon. If you would invest 1,480 in Hayward Holdings on August 27, 2024 and sell it today you would earn a total of 126.00 from holding Hayward Holdings or generate 8.51% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Ads Tec Energy vs. Hayward Holdings
Performance |
| Timeline |
| Ads Tec Energy |
| Hayward Holdings |
Ads Tec and Hayward Holdings Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Ads Tec and Hayward Holdings
The main advantage of trading using opposite Ads Tec and Hayward Holdings positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Ads Tec position performs unexpectedly, Hayward Holdings 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 Hayward Holdings will offset losses from the drop in Hayward Holdings' long position.| Ads Tec vs. Espey Mfg Electronics | Ads Tec vs. NeoVolta Warrant | Ads Tec vs. Kimball Electronics | Ads Tec vs. Hayward Holdings |
| Hayward Holdings vs. Kimball Electronics | Hayward Holdings vs. Enersys | Hayward Holdings vs. Espey Mfg Electronics | Hayward Holdings vs. Energizer Holdings |
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 Price Ceiling Movement module to calculate and plot Price Ceiling Movement for different equity instruments.
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