Correlation Between Aquagold International and HCM Defender
Can any of the company-specific risk be diversified away by investing in both Aquagold International and HCM Defender 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 Aquagold International and HCM Defender into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Aquagold International and HCM Defender 100, you can compare the effects of market volatilities on Aquagold International and HCM Defender 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 Aquagold International with a short position of HCM Defender. Check out your portfolio center. Please also check ongoing floating volatility patterns of Aquagold International and HCM Defender.
Diversification Opportunities for Aquagold International and HCM Defender
0.0 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between Aquagold and HCM is 0.0. Overlapping area represents the amount of risk that can be diversified away by holding Aquagold International and HCM Defender 100 in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on HCM Defender 100 and Aquagold 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 Aquagold International are associated (or correlated) with HCM Defender. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of HCM Defender 100 has no effect on the direction of Aquagold International i.e., Aquagold International and HCM Defender go up and down completely randomly.
Pair Corralation between Aquagold International and HCM Defender
Given the investment horizon of 90 days Aquagold International is expected to under-perform the HCM Defender. In addition to that, Aquagold International is 3.58 times more volatile than HCM Defender 100. It trades about 0.0 of its total potential returns per unit of risk. HCM Defender 100 is currently generating about 0.1 per unit of volatility. If you would invest 3,977 in HCM Defender 100 on August 30, 2024 and sell it today you would earn a total of 2,574 from holding HCM Defender 100 or generate 64.72% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Flat |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Aquagold International vs. HCM Defender 100
Performance |
| Timeline |
| Aquagold International |
| HCM Defender 100 |
Aquagold International and HCM Defender Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Aquagold International and HCM Defender
The main advantage of trading using opposite Aquagold International and HCM Defender positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Aquagold International position performs unexpectedly, HCM Defender 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 HCM Defender will offset losses from the drop in HCM Defender's long position.| Aquagold International vs. PepsiCo | Aquagold International vs. Coca Cola Consolidated | Aquagold International vs. Monster Beverage Corp | Aquagold International vs. Celsius Holdings |
| HCM Defender vs. iShares MSCI USA | HCM Defender vs. iShares MSCI USA | HCM Defender vs. iShares MSCI USA | HCM Defender vs. iShares Expanded Tech Software |
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 Risk-Return Analysis module to view associations between returns expected from investment and the risk you assume.
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