Correlation Between HAVILAH RESOURCES and APPLIED MATERIALS
Can any of the company-specific risk be diversified away by investing in both HAVILAH RESOURCES and APPLIED MATERIALS 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 HAVILAH RESOURCES and APPLIED MATERIALS into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between HAVILAH RESOURCES and APPLIED MATERIALS, you can compare the effects of market volatilities on HAVILAH RESOURCES and APPLIED MATERIALS 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 HAVILAH RESOURCES with a short position of APPLIED MATERIALS. Check out your portfolio center. Please also check ongoing floating volatility patterns of HAVILAH RESOURCES and APPLIED MATERIALS.
Diversification Opportunities for HAVILAH RESOURCES and APPLIED MATERIALS
0.27 | Correlation Coefficient |
Modest diversification
The 3 months correlation between HAVILAH and APPLIED is 0.27. Overlapping area represents the amount of risk that can be diversified away by holding HAVILAH RESOURCES and APPLIED MATERIALS in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on APPLIED MATERIALS and HAVILAH RESOURCES 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 HAVILAH RESOURCES are associated (or correlated) with APPLIED MATERIALS. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of APPLIED MATERIALS has no effect on the direction of HAVILAH RESOURCES i.e., HAVILAH RESOURCES and APPLIED MATERIALS go up and down completely randomly.
Pair Corralation between HAVILAH RESOURCES and APPLIED MATERIALS
Assuming the 90 days trading horizon HAVILAH RESOURCES is expected to generate 0.74 times more return on investment than APPLIED MATERIALS. However, HAVILAH RESOURCES is 1.36 times less risky than APPLIED MATERIALS. It trades about 0.21 of its potential returns per unit of risk. APPLIED MATERIALS is currently generating about -0.02 per unit of risk. If you would invest 11.00 in HAVILAH RESOURCES on September 2, 2024 and sell it today you would earn a total of 1.00 from holding HAVILAH RESOURCES or generate 9.09% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
HAVILAH RESOURCES vs. APPLIED MATERIALS
Performance |
| Timeline |
| HAVILAH RESOURCES |
| APPLIED MATERIALS |
HAVILAH RESOURCES and APPLIED MATERIALS Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with HAVILAH RESOURCES and APPLIED MATERIALS
The main advantage of trading using opposite HAVILAH RESOURCES and APPLIED MATERIALS positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if HAVILAH RESOURCES position performs unexpectedly, APPLIED MATERIALS 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 APPLIED MATERIALS will offset losses from the drop in APPLIED MATERIALS's long position.| HAVILAH RESOURCES vs. PENN NATL GAMING | HAVILAH RESOURCES vs. Diamyd Medical AB | HAVILAH RESOURCES vs. HOCHSCHILD MINING | HAVILAH RESOURCES vs. Merit Medical Systems |
| APPLIED MATERIALS vs. SBM OFFSHORE | APPLIED MATERIALS vs. Wizz Air Holdings | APPLIED MATERIALS vs. Selective Insurance Group | APPLIED MATERIALS vs. Japan Post Insurance |
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 Odds Of Bankruptcy module to get analysis of equity chance of financial distress in the next 2 years.
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