Correlation Between Energy Absolute and WHA Public
Can any of the company-specific risk be diversified away by investing in both Energy Absolute and WHA Public 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 Energy Absolute and WHA Public into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Energy Absolute Public and WHA Public, you can compare the effects of market volatilities on Energy Absolute and WHA Public 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 Energy Absolute with a short position of WHA Public. Check out your portfolio center. Please also check ongoing floating volatility patterns of Energy Absolute and WHA Public.
Diversification Opportunities for Energy Absolute and WHA Public
-0.11 | Correlation Coefficient |
Good diversification
The 3 months correlation between Energy and WHA is -0.11. Overlapping area represents the amount of risk that can be diversified away by holding Energy Absolute Public and WHA Public in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on WHA Public and Energy Absolute 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 Energy Absolute Public are associated (or correlated) with WHA Public. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of WHA Public has no effect on the direction of Energy Absolute i.e., Energy Absolute and WHA Public go up and down completely randomly.
Pair Corralation between Energy Absolute and WHA Public
Assuming the 90 days horizon Energy Absolute Public is expected to under-perform the WHA Public. In addition to that, Energy Absolute is 1.61 times more volatile than WHA Public. It trades about -0.42 of its total potential returns per unit of risk. WHA Public is currently generating about -0.02 per unit of volatility. If you would invest 568.00 in WHA Public on August 31, 2024 and sell it today you would lose (8.00) from holding WHA Public or give up 1.41% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Energy Absolute Public vs. WHA Public
Performance |
| Timeline |
| Energy Absolute Public |
| WHA Public |
Energy Absolute and WHA Public Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Energy Absolute and WHA Public
The main advantage of trading using opposite Energy Absolute and WHA Public positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Energy Absolute position performs unexpectedly, WHA Public 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 WHA Public will offset losses from the drop in WHA Public's long position.| Energy Absolute vs. Sawang Export Public | Energy Absolute vs. Quality Houses Hotel | Energy Absolute vs. Grande Hospitality Real | Energy Absolute vs. City Steel Public |
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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 Crypto Correlations module to use cryptocurrency correlation module to diversify your cryptocurrency portfolio across multiple coins.
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