Correlation Between Caseys General and HubSpot
Can any of the company-specific risk be diversified away by investing in both Caseys General and HubSpot 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 Caseys General and HubSpot into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Caseys General Stores and HubSpot, you can compare the effects of market volatilities on Caseys General and HubSpot 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 Caseys General with a short position of HubSpot. Check out your portfolio center. Please also check ongoing floating volatility patterns of Caseys General and HubSpot.
Diversification Opportunities for Caseys General and HubSpot
0.94 | Correlation Coefficient |
Almost no diversification
The 3 months correlation between Caseys and HubSpot is 0.94. Overlapping area represents the amount of risk that can be diversified away by holding Caseys General Stores and HubSpot in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on HubSpot and Caseys General 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 Caseys General Stores are associated (or correlated) with HubSpot. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of HubSpot has no effect on the direction of Caseys General i.e., Caseys General and HubSpot go up and down completely randomly.
Pair Corralation between Caseys General and HubSpot
Assuming the 90 days trading horizon Caseys General is expected to generate 7.87 times less return on investment than HubSpot. But when comparing it to its historical volatility, Caseys General Stores is 1.77 times less risky than HubSpot. It trades about 0.06 of its potential returns per unit of risk. HubSpot is currently generating about 0.26 of returns per unit of risk over similar time horizon. If you would invest 61,160 in HubSpot on September 12, 2024 and sell it today you would earn a total of 8,480 from holding HubSpot or generate 13.87% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Caseys General Stores vs. HubSpot
Performance |
| Timeline |
| Caseys General Stores |
| HubSpot |
Caseys General and HubSpot Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Caseys General and HubSpot
The main advantage of trading using opposite Caseys General and HubSpot positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Caseys General position performs unexpectedly, HubSpot 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 HubSpot will offset losses from the drop in HubSpot's long position.| Caseys General vs. Apple Inc | Caseys General vs. Apple Inc | Caseys General vs. Apple Inc | Caseys General vs. Apple Inc |
| HubSpot vs. BOS BETTER ONLINE | HubSpot vs. DFS Furniture PLC | HubSpot vs. CENTURIA OFFICE REIT | HubSpot vs. Lamar Advertising |
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 FinTech Suite module to use AI to screen and filter profitable investment opportunities.
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