Correlation Between Hollywood Bowl and Endeavour Mining
Can any of the company-specific risk be diversified away by investing in both Hollywood Bowl and Endeavour Mining 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 Endeavour Mining 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 Endeavour Mining Corp, you can compare the effects of market volatilities on Hollywood Bowl and Endeavour Mining 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 Endeavour Mining. Check out your portfolio center. Please also check ongoing floating volatility patterns of Hollywood Bowl and Endeavour Mining.
Diversification Opportunities for Hollywood Bowl and Endeavour Mining
-0.2 | Correlation Coefficient |
Good diversification
The 3 months correlation between Hollywood and Endeavour is -0.2. Overlapping area represents the amount of risk that can be diversified away by holding Hollywood Bowl Group and Endeavour Mining Corp in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Endeavour Mining Corp 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 Endeavour Mining. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Endeavour Mining Corp has no effect on the direction of Hollywood Bowl i.e., Hollywood Bowl and Endeavour Mining go up and down completely randomly.
Pair Corralation between Hollywood Bowl and Endeavour Mining
Assuming the 90 days trading horizon Hollywood Bowl Group is expected to generate 0.72 times more return on investment than Endeavour Mining. However, Hollywood Bowl Group is 1.38 times less risky than Endeavour Mining. It trades about 0.12 of its potential returns per unit of risk. Endeavour Mining Corp is currently generating about -0.13 per unit of risk. If you would invest 32,400 in Hollywood Bowl Group on September 12, 2024 and sell it today you would earn a total of 900.00 from holding Hollywood Bowl Group or generate 2.78% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Hollywood Bowl Group vs. Endeavour Mining Corp
Performance |
| Timeline |
| Hollywood Bowl Group |
| Endeavour Mining Corp |
Hollywood Bowl and Endeavour Mining Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Hollywood Bowl and Endeavour Mining
The main advantage of trading using opposite Hollywood Bowl and Endeavour Mining positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Hollywood Bowl position performs unexpectedly, Endeavour Mining 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 Endeavour Mining will offset losses from the drop in Endeavour Mining's long position.| Hollywood Bowl vs. National Atomic Co | Hollywood Bowl vs. OTP Bank Nyrt | Hollywood Bowl vs. Samsung Electronics Co | Hollywood Bowl vs. Samsung Electronics Co |
| Endeavour Mining vs. Givaudan SA | Endeavour Mining vs. Antofagasta PLC | Endeavour Mining vs. Ferrexpo PLC | Endeavour Mining vs. Atalaya Mining |
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 Portfolio Holdings module to check your current holdings and cash postion to detemine if your portfolio needs rebalancing.
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