Correlation Between SIERRA METALS and Hollywood Bowl
Can any of the company-specific risk be diversified away by investing in both SIERRA METALS and Hollywood Bowl 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 SIERRA METALS and Hollywood Bowl into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between SIERRA METALS and Hollywood Bowl Group, you can compare the effects of market volatilities on SIERRA METALS and Hollywood Bowl 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 SIERRA METALS with a short position of Hollywood Bowl. Check out your portfolio center. Please also check ongoing floating volatility patterns of SIERRA METALS and Hollywood Bowl.
Diversification Opportunities for SIERRA METALS and Hollywood Bowl
-0.49 | Correlation Coefficient |
Very good diversification
The 3 months correlation between SIERRA and Hollywood is -0.49. Overlapping area represents the amount of risk that can be diversified away by holding SIERRA METALS and Hollywood Bowl Group in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Hollywood Bowl Group and SIERRA METALS 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 SIERRA METALS are associated (or correlated) with Hollywood Bowl. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Hollywood Bowl Group has no effect on the direction of SIERRA METALS i.e., SIERRA METALS and Hollywood Bowl go up and down completely randomly.
Pair Corralation between SIERRA METALS and Hollywood Bowl
Assuming the 90 days trading horizon SIERRA METALS is expected to generate 0.8 times more return on investment than Hollywood Bowl. However, SIERRA METALS is 1.26 times less risky than Hollywood Bowl. It trades about 0.24 of its potential returns per unit of risk. Hollywood Bowl Group is currently generating about 0.05 per unit of risk. If you would invest 55.00 in SIERRA METALS on November 3, 2024 and sell it today you would earn a total of 6.00 from holding SIERRA METALS or generate 10.91% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
SIERRA METALS vs. Hollywood Bowl Group
Performance |
| Timeline |
| SIERRA METALS |
| Hollywood Bowl Group |
SIERRA METALS and Hollywood Bowl Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with SIERRA METALS and Hollywood Bowl
The main advantage of trading using opposite SIERRA METALS and Hollywood Bowl positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if SIERRA METALS position performs unexpectedly, Hollywood Bowl 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 Hollywood Bowl will offset losses from the drop in Hollywood Bowl's long position.| SIERRA METALS vs. SIVERS SEMICONDUCTORS AB | SIERRA METALS vs. NorAm Drilling AS | SIERRA METALS vs. Volkswagen AG | SIERRA METALS vs. Darden Restaurants |
| Hollywood Bowl vs. Agilent Technologies | Hollywood Bowl vs. Kingdee International Software | Hollywood Bowl vs. NH HOTEL GROUP | Hollywood Bowl vs. Xenia Hotels Resorts |
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 Sign In To Macroaxis module to sign in to explore Macroaxis' wealth optimization platform and fintech modules.
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