Correlation Between Catholic Responsible and Hennessy
Can any of the company-specific risk be diversified away by investing in both Catholic Responsible and Hennessy 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 Catholic Responsible and Hennessy into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Catholic Responsible Investments and Hennessy Bp Energy, you can compare the effects of market volatilities on Catholic Responsible and Hennessy 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 Catholic Responsible with a short position of Hennessy. Check out your portfolio center. Please also check ongoing floating volatility patterns of Catholic Responsible and Hennessy.
Diversification Opportunities for Catholic Responsible and Hennessy
-0.58 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between Catholic and Hennessy is -0.58. Overlapping area represents the amount of risk that can be diversified away by holding Catholic Responsible Investmen and Hennessy Bp Energy in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Hennessy Bp Energy and Catholic Responsible 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 Catholic Responsible Investments are associated (or correlated) with Hennessy. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Hennessy Bp Energy has no effect on the direction of Catholic Responsible i.e., Catholic Responsible and Hennessy go up and down completely randomly.
Pair Corralation between Catholic Responsible and Hennessy
Assuming the 90 days horizon Catholic Responsible Investments is expected to generate 0.27 times more return on investment than Hennessy. However, Catholic Responsible Investments is 3.64 times less risky than Hennessy. It trades about 0.13 of its potential returns per unit of risk. Hennessy Bp Energy is currently generating about -0.07 per unit of risk. If you would invest 849.00 in Catholic Responsible Investments on September 12, 2024 and sell it today you would earn a total of 6.00 from holding Catholic Responsible Investments or generate 0.71% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Catholic Responsible Investmen vs. Hennessy Bp Energy
Performance |
| Timeline |
| Catholic Responsible |
| Hennessy Bp Energy |
Catholic Responsible and Hennessy Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Catholic Responsible and Hennessy
The main advantage of trading using opposite Catholic Responsible and Hennessy positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Catholic Responsible position performs unexpectedly, Hennessy 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 Hennessy will offset losses from the drop in Hennessy's long position.| Catholic Responsible vs. Hennessy Bp Energy | Catholic Responsible vs. Tortoise Energy Independence | Catholic Responsible vs. Invesco Energy Fund | Catholic Responsible vs. Goehring Rozencwajg Resources |
| Hennessy vs. World Energy Fund | Hennessy vs. Ivy Energy Fund | Hennessy vs. Blackrock All Cap Energy | Hennessy vs. Energy Fund Class |
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 Commodity Directory module to find actively traded commodities issued by global exchanges.
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