Correlation Between HF Company and Axway Software
Can any of the company-specific risk be diversified away by investing in both HF Company and Axway Software 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 HF Company and Axway Software into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between HF Company SA and Axway Software, you can compare the effects of market volatilities on HF Company and Axway Software 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 HF Company with a short position of Axway Software. Check out your portfolio center. Please also check ongoing floating volatility patterns of HF Company and Axway Software.
Diversification Opportunities for HF Company and Axway Software
-0.19 | Correlation Coefficient |
Good diversification
The 3 months correlation between ALHF and Axway is -0.19. Overlapping area represents the amount of risk that can be diversified away by holding HF Company SA and Axway Software in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Axway Software and HF Company 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 HF Company SA are associated (or correlated) with Axway Software. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Axway Software has no effect on the direction of HF Company i.e., HF Company and Axway Software go up and down completely randomly.
Pair Corralation between HF Company and Axway Software
Assuming the 90 days trading horizon HF Company SA is expected to generate 0.96 times more return on investment than Axway Software. However, HF Company SA is 1.04 times less risky than Axway Software. It trades about 0.1 of its potential returns per unit of risk. Axway Software is currently generating about -0.04 per unit of risk. If you would invest 442.00 in HF Company SA on September 19, 2024 and sell it today you would earn a total of 8.00 from holding HF Company SA or generate 1.81% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 86.36% |
| Values | Daily Returns |
HF Company SA vs. Axway Software
Performance |
| Timeline |
| HF Company SA |
| Axway Software |
HF Company and Axway Software Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with HF Company and Axway Software
The main advantage of trading using opposite HF Company and Axway Software positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if HF Company position performs unexpectedly, Axway Software 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 Axway Software will offset losses from the drop in Axway Software's long position.| HF Company vs. Axway Software | HF Company vs. Metalliance SA | HF Company vs. Onlineformapro SA | HF Company vs. Diagnostic Medical Systems |
| Axway Software vs. Groupe Guillin SA | Axway Software vs. Stef SA | Axway Software vs. SA Catana Group | Axway Software vs. Jacquet Metal Service |
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 USA ETFs module to find actively traded Exchange Traded Funds (ETF) in USA.
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