Correlation Between Halma PLC and Marubeni
Can any of the company-specific risk be diversified away by investing in both Halma PLC and Marubeni 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 Halma PLC and Marubeni into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Halma PLC and Marubeni, you can compare the effects of market volatilities on Halma PLC and Marubeni 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 Halma PLC with a short position of Marubeni. Check out your portfolio center. Please also check ongoing floating volatility patterns of Halma PLC and Marubeni.
Diversification Opportunities for Halma PLC and Marubeni
Modest diversification
The 3 months correlation between Halma and Marubeni is 0.25. Overlapping area represents the amount of risk that can be diversified away by holding Halma PLC and Marubeni in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Marubeni and Halma PLC 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 Halma PLC are associated (or correlated) with Marubeni. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Marubeni has no effect on the direction of Halma PLC i.e., Halma PLC and Marubeni go up and down completely randomly.
Pair Corralation between Halma PLC and Marubeni
Assuming the 90 days horizon Halma PLC is expected to generate 1.19 times less return on investment than Marubeni. But when comparing it to its historical volatility, Halma PLC is 1.69 times less risky than Marubeni. It trades about 0.19 of its potential returns per unit of risk. Marubeni is currently generating about 0.14 of returns per unit of risk over similar time horizon. If you would invest 1,434 in Marubeni on September 2, 2024 and sell it today you would earn a total of 154.00 from holding Marubeni or generate 10.74% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Halma PLC vs. Marubeni
Performance |
| Timeline |
| Halma PLC |
| Marubeni |
Halma PLC and Marubeni Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Halma PLC and Marubeni
The main advantage of trading using opposite Halma PLC and Marubeni positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Halma PLC position performs unexpectedly, Marubeni 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 Marubeni will offset losses from the drop in Marubeni's long position.| Halma PLC vs. Seaboard | Halma PLC vs. Valmont Industries | Halma PLC vs. Honeywell International | Halma PLC vs. 3M Company |
| Marubeni vs. Marubeni Corp ADR | Marubeni vs. Mitsubishi Corp | Marubeni vs. Sumitomo Corp ADR | Marubeni vs. Itochu Corp ADR |
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 Stock Tickers module to use high-impact, comprehensive, and customizable stock tickers that can be easily integrated to any websites.
Other Complementary Tools
| Equity Search Search for actively traded equities including funds and ETFs from over 30 global markets | |
| Idea Analyzer Analyze all characteristics, volatility and risk-adjusted return of Macroaxis ideas | |
| Money Managers Screen money managers from public funds and ETFs managed around the world | |
| ETFs Find actively traded Exchange Traded Funds (ETF) from around the world | |
| Cryptocurrency Center Build and monitor diversified portfolio of extremely risky digital assets and cryptocurrency |