Correlation Between Intal High and Hennessy Technology
Can any of the company-specific risk be diversified away by investing in both Intal High and Hennessy Technology 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 Intal High and Hennessy Technology into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Intal High Relative and Hennessy Technology Fund, you can compare the effects of market volatilities on Intal High and Hennessy Technology 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 Intal High with a short position of Hennessy Technology. Check out your portfolio center. Please also check ongoing floating volatility patterns of Intal High and Hennessy Technology.
Diversification Opportunities for Intal High and Hennessy Technology
-0.51 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between Intal and Hennessy is -0.51. Overlapping area represents the amount of risk that can be diversified away by holding Intal High Relative and Hennessy Technology Fund in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Hennessy Technology and Intal High 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 Intal High Relative are associated (or correlated) with Hennessy Technology. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Hennessy Technology has no effect on the direction of Intal High i.e., Intal High and Hennessy Technology go up and down completely randomly.
Pair Corralation between Intal High and Hennessy Technology
Assuming the 90 days horizon Intal High Relative is expected to generate 0.37 times more return on investment than Hennessy Technology. However, Intal High Relative is 2.68 times less risky than Hennessy Technology. It trades about 0.2 of its potential returns per unit of risk. Hennessy Technology Fund is currently generating about 0.01 per unit of risk. If you would invest 1,266 in Intal High Relative on September 14, 2024 and sell it today you would earn a total of 32.00 from holding Intal High Relative or generate 2.53% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Intal High Relative vs. Hennessy Technology Fund
Performance |
| Timeline |
| Intal High Relative |
| Hennessy Technology |
Intal High and Hennessy Technology Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Intal High and Hennessy Technology
The main advantage of trading using opposite Intal High and Hennessy Technology positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Intal High position performs unexpectedly, Hennessy Technology 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 Technology will offset losses from the drop in Hennessy Technology's long position.| Intal High vs. Sarofim Equity | Intal High vs. Mondrian Global Equity | Intal High vs. Multimedia Portfolio Multimedia | Intal High vs. Gmo Global Equity |
| Hennessy Technology vs. Aqr Long Short Equity | Hennessy Technology vs. Shelton Emerging Markets | Hennessy Technology vs. Sp Midcap Index | Hennessy Technology vs. T Rowe Price |
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 Stock Screener module to find equities using a custom stock filter or screen asymmetry in trading patterns, price, volume, or investment outlook..
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