Correlation Between Converge Information and Harbor Star
Can any of the company-specific risk be diversified away by investing in both Converge Information and Harbor Star 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 Converge Information and Harbor Star into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Converge Information Communications and Harbor Star Shipping, you can compare the effects of market volatilities on Converge Information and Harbor Star 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 Converge Information with a short position of Harbor Star. Check out your portfolio center. Please also check ongoing floating volatility patterns of Converge Information and Harbor Star.
Diversification Opportunities for Converge Information and Harbor Star
-0.31 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Converge and Harbor is -0.31. Overlapping area represents the amount of risk that can be diversified away by holding Converge Information Communica and Harbor Star Shipping in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Harbor Star Shipping and Converge Information 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 Converge Information Communications are associated (or correlated) with Harbor Star. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Harbor Star Shipping has no effect on the direction of Converge Information i.e., Converge Information and Harbor Star go up and down completely randomly.
Pair Corralation between Converge Information and Harbor Star
Assuming the 90 days trading horizon Converge Information is expected to generate 9.57 times less return on investment than Harbor Star. But when comparing it to its historical volatility, Converge Information Communications is 1.19 times less risky than Harbor Star. It trades about 0.04 of its potential returns per unit of risk. Harbor Star Shipping is currently generating about 0.29 of returns per unit of risk over similar time horizon. If you would invest 57.00 in Harbor Star Shipping on November 28, 2024 and sell it today you would earn a total of 11.00 from holding Harbor Star Shipping or generate 19.3% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Converge Information Communica vs. Harbor Star Shipping
Performance |
| Timeline |
| Converge Information |
| Harbor Star Shipping |
Converge Information and Harbor Star Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Converge Information and Harbor Star
The main advantage of trading using opposite Converge Information and Harbor Star positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Converge Information position performs unexpectedly, Harbor Star 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 Harbor Star will offset losses from the drop in Harbor Star's long position.| Converge Information vs. Jollibee Foods Corp | Converge Information vs. Cebu Air Preferred | Converge Information vs. Semirara Mining Corp | Converge Information vs. Apex Mining Co |
| Harbor Star vs. East West Banking | Harbor Star vs. Converge Information Communications | Harbor Star vs. Security Bank Corp | Harbor Star vs. Union Bank of |
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 Comparator module to compare the composition, asset allocations and performance of any two portfolios in your account.
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