Correlation Between Hollywood Bowl and Bank of Ireland
Can any of the company-specific risk be diversified away by investing in both Hollywood Bowl and Bank of Ireland 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 Hollywood Bowl and Bank of Ireland into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Hollywood Bowl Group and Bank of Ireland, you can compare the effects of market volatilities on Hollywood Bowl and Bank of Ireland 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 Hollywood Bowl with a short position of Bank of Ireland. Check out your portfolio center. Please also check ongoing floating volatility patterns of Hollywood Bowl and Bank of Ireland.
Diversification Opportunities for Hollywood Bowl and Bank of Ireland
-0.4 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Hollywood and Bank is -0.4. Overlapping area represents the amount of risk that can be diversified away by holding Hollywood Bowl Group and Bank of Ireland in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Bank of Ireland and Hollywood Bowl 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 Hollywood Bowl Group are associated (or correlated) with Bank of Ireland. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Bank of Ireland has no effect on the direction of Hollywood Bowl i.e., Hollywood Bowl and Bank of Ireland go up and down completely randomly.
Pair Corralation between Hollywood Bowl and Bank of Ireland
Assuming the 90 days trading horizon Hollywood Bowl Group is expected to generate 0.62 times more return on investment than Bank of Ireland. However, Hollywood Bowl Group is 1.6 times less risky than Bank of Ireland. It trades about 0.05 of its potential returns per unit of risk. Bank of Ireland is currently generating about -0.14 per unit of risk. If you would invest 31,700 in Hollywood Bowl Group on September 4, 2024 and sell it today you would earn a total of 350.00 from holding Hollywood Bowl Group or generate 1.1% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Hollywood Bowl Group vs. Bank of Ireland
Performance |
| Timeline |
| Hollywood Bowl Group |
| Bank of Ireland |
Hollywood Bowl and Bank of Ireland Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Hollywood Bowl and Bank of Ireland
The main advantage of trading using opposite Hollywood Bowl and Bank of Ireland positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Hollywood Bowl position performs unexpectedly, Bank of Ireland 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 Bank of Ireland will offset losses from the drop in Bank of Ireland's long position.| Hollywood Bowl vs. Samsung Electronics Co | Hollywood Bowl vs. Samsung Electronics Co | Hollywood Bowl vs. Hyundai Motor | Hollywood Bowl vs. Toyota Motor Corp |
| Bank of Ireland vs. SupplyMe Capital PLC | Bank of Ireland vs. SM Energy Co | Bank of Ireland vs. FuelCell Energy | Bank of Ireland vs. Grand Vision Media |
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 Funds Screener module to find actively-traded funds from around the world traded on over 30 global exchanges.
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