Correlation Between Hoffmann Green and Voltalia
Can any of the company-specific risk be diversified away by investing in both Hoffmann Green and Voltalia 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 Hoffmann Green and Voltalia into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Hoffmann Green Cement and Voltalia SA, you can compare the effects of market volatilities on Hoffmann Green and Voltalia 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 Hoffmann Green with a short position of Voltalia. Check out your portfolio center. Please also check ongoing floating volatility patterns of Hoffmann Green and Voltalia.
Diversification Opportunities for Hoffmann Green and Voltalia
-0.05 | Correlation Coefficient |
Good diversification
The 3 months correlation between Hoffmann and Voltalia is -0.05. Overlapping area represents the amount of risk that can be diversified away by holding Hoffmann Green Cement and Voltalia SA in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Voltalia SA and Hoffmann Green 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 Hoffmann Green Cement are associated (or correlated) with Voltalia. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Voltalia SA has no effect on the direction of Hoffmann Green i.e., Hoffmann Green and Voltalia go up and down completely randomly.
Pair Corralation between Hoffmann Green and Voltalia
Assuming the 90 days trading horizon Hoffmann Green Cement is expected to under-perform the Voltalia. But the stock apears to be less risky and, when comparing its historical volatility, Hoffmann Green Cement is 1.13 times less risky than Voltalia. The stock trades about -0.04 of its potential returns per unit of risk. The Voltalia SA is currently generating about 0.0 of returns per unit of risk over similar time horizon. If you would invest 912.00 in Voltalia SA on September 4, 2024 and sell it today you would lose (182.00) from holding Voltalia SA or give up 19.96% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Hoffmann Green Cement vs. Voltalia SA
Performance |
| Timeline |
| Hoffmann Green Cement |
| Voltalia SA |
Hoffmann Green and Voltalia Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Hoffmann Green and Voltalia
The main advantage of trading using opposite Hoffmann Green and Voltalia positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Hoffmann Green position performs unexpectedly, Voltalia 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 Voltalia will offset losses from the drop in Voltalia's long position.| Hoffmann Green vs. Carbios | Hoffmann Green vs. Voltalia SA | Hoffmann Green vs. Neoen SA | Hoffmann Green vs. Kalray SA |
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 Watchlist Optimization module to optimize watchlists to build efficient portfolios or rebalance existing positions based on the mean-variance optimization algorithm.
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