Correlation Between Hafnia and Zapata Computing
Can any of the company-specific risk be diversified away by investing in both Hafnia and Zapata Computing 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 Zapata Computing into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Hafnia Limited and Zapata Computing Holdings, you can compare the effects of market volatilities on Hafnia and Zapata Computing 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 Zapata Computing. Check out your portfolio center. Please also check ongoing floating volatility patterns of Hafnia and Zapata Computing.
Diversification Opportunities for Hafnia and Zapata Computing
0.8 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between Hafnia and Zapata is 0.8. Overlapping area represents the amount of risk that can be diversified away by holding Hafnia Limited and Zapata Computing Holdings in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Zapata Computing Holdings 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 Zapata Computing. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Zapata Computing Holdings has no effect on the direction of Hafnia i.e., Hafnia and Zapata Computing go up and down completely randomly.
Pair Corralation between Hafnia and Zapata Computing
Given the investment horizon of 90 days Hafnia is expected to generate 37.47 times less return on investment than Zapata Computing. But when comparing it to its historical volatility, Hafnia Limited is 17.96 times less risky than Zapata Computing. It trades about 0.02 of its potential returns per unit of risk. Zapata Computing Holdings is currently generating about 0.04 of returns per unit of risk over similar time horizon. If you would invest 29.00 in Zapata Computing Holdings on September 4, 2024 and sell it today you would lose (28.44) from holding Zapata Computing Holdings or give up 98.07% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Strong |
| Accuracy | 85.16% |
| Values | Daily Returns |
Hafnia Limited vs. Zapata Computing Holdings
Performance |
| Timeline |
| Hafnia Limited |
| Zapata Computing Holdings |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
OK
Hafnia and Zapata Computing Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Hafnia and Zapata Computing
The main advantage of trading using opposite Hafnia and Zapata Computing positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Hafnia position performs unexpectedly, Zapata Computing 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 Zapata Computing will offset losses from the drop in Zapata Computing's long position.| Hafnia vs. Axalta Coating Systems | Hafnia vs. NL Industries | Hafnia vs. Chemours Co | Hafnia vs. CVR Partners LP |
| Zapata Computing vs. FormFactor | Zapata Computing vs. Paysafe | Zapata Computing vs. Uber Technologies | Zapata Computing vs. Minerals Technologies |
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 Equity Analysis module to research over 250,000 global equities including funds, stocks and ETFs to find investment opportunities.
Other Complementary Tools
| Investing Opportunities Build portfolios using our predefined set of ideas and optimize them against your investing preferences | |
| Portfolio Optimization Compute new portfolio that will generate highest expected return given your specified tolerance for risk | |
| Equity Analysis Research over 250,000 global equities including funds, stocks and ETFs to find investment opportunities | |
| Stock Screener Find equities using a custom stock filter or screen asymmetry in trading patterns, price, volume, or investment outlook. | |
| Idea Breakdown Analyze constituents of all Macroaxis ideas. Macroaxis investment ideas are predefined, sector-focused investing themes |