Correlation Between Hafnia and Definitive Healthcare
Can any of the company-specific risk be diversified away by investing in both Hafnia and Definitive Healthcare 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 Hafnia and Definitive Healthcare into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Hafnia Limited and Definitive Healthcare Corp, you can compare the effects of market volatilities on Hafnia and Definitive Healthcare 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 Hafnia with a short position of Definitive Healthcare. Check out your portfolio center. Please also check ongoing floating volatility patterns of Hafnia and Definitive Healthcare.
Diversification Opportunities for Hafnia and Definitive Healthcare
0.23 | Correlation Coefficient |
Modest diversification
The 3 months correlation between Hafnia and Definitive is 0.23. Overlapping area represents the amount of risk that can be diversified away by holding Hafnia Limited and Definitive Healthcare Corp in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Definitive Healthcare and Hafnia 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 Hafnia Limited are associated (or correlated) with Definitive Healthcare. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Definitive Healthcare has no effect on the direction of Hafnia i.e., Hafnia and Definitive Healthcare go up and down completely randomly.
Pair Corralation between Hafnia and Definitive Healthcare
Given the investment horizon of 90 days Hafnia Limited is expected to under-perform the Definitive Healthcare. But the stock apears to be less risky and, when comparing its historical volatility, Hafnia Limited is 1.21 times less risky than Definitive Healthcare. The stock trades about -0.09 of its potential returns per unit of risk. The Definitive Healthcare Corp is currently generating about 0.14 of returns per unit of risk over similar time horizon. If you would invest 355.00 in Definitive Healthcare Corp on September 4, 2024 and sell it today you would earn a total of 119.00 from holding Definitive Healthcare Corp or generate 33.52% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Hafnia Limited vs. Definitive Healthcare Corp
Performance |
| Timeline |
| Hafnia Limited |
| Definitive Healthcare |
Hafnia and Definitive Healthcare Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Hafnia and Definitive Healthcare
The main advantage of trading using opposite Hafnia and Definitive Healthcare positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Hafnia position performs unexpectedly, Definitive Healthcare 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 Definitive Healthcare will offset losses from the drop in Definitive Healthcare's long position.| Hafnia vs. Axalta Coating Systems | Hafnia vs. NL Industries | Hafnia vs. Chemours Co | Hafnia vs. CVR Partners LP |
| Definitive Healthcare vs. National Research Corp | Definitive Healthcare vs. Evolent Health | Definitive Healthcare vs. Simulations Plus | Definitive Healthcare vs. Privia Health Group |
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 Sync Your Broker module to sync your existing holdings, watchlists, positions or portfolios from thousands of online brokerage services, banks, investment account aggregators and robo-advisors..
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