Correlation Between Empire State and HAV Group
Can any of the company-specific risk be diversified away by investing in both Empire State and HAV Group 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 Empire State and HAV Group into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Empire State Realty and HAV Group ASA, you can compare the effects of market volatilities on Empire State and HAV Group 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 Empire State with a short position of HAV Group. Check out your portfolio center. Please also check ongoing floating volatility patterns of Empire State and HAV Group.
Diversification Opportunities for Empire State and HAV Group
0.59 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Empire and HAV is 0.59. Overlapping area represents the amount of risk that can be diversified away by holding Empire State Realty and HAV Group ASA in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on HAV Group ASA and Empire State 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 Empire State Realty are associated (or correlated) with HAV Group. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of HAV Group ASA has no effect on the direction of Empire State i.e., Empire State and HAV Group go up and down completely randomly.
Pair Corralation between Empire State and HAV Group
Given the investment horizon of 90 days Empire State Realty is expected to generate 0.87 times more return on investment than HAV Group. However, Empire State Realty is 1.15 times less risky than HAV Group. It trades about 0.04 of its potential returns per unit of risk. HAV Group ASA is currently generating about -0.05 per unit of risk. If you would invest 618.00 in Empire State Realty on November 27, 2024 and sell it today you would earn a total of 247.00 from holding Empire State Realty or generate 39.97% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Empire State Realty vs. HAV Group ASA
Performance |
| Timeline |
| Empire State Realty |
| HAV Group ASA |
Empire State and HAV Group Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Empire State and HAV Group
The main advantage of trading using opposite Empire State and HAV Group positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Empire State position performs unexpectedly, HAV Group 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 HAV Group will offset losses from the drop in HAV Group's long position.| Empire State vs. Paramount Group | Empire State vs. Hudson Pacific Properties | Empire State vs. Equity Commonwealth | Empire State vs. Douglas Emmett |
| HAV Group vs. Sogn Sparebank | HAV Group vs. SpareBank 1 stlandet | HAV Group vs. Sparebank 1 SMN | HAV Group vs. Pareto Bank ASA |
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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