Correlation Between Hasbro and Clarus Corp
Can any of the company-specific risk be diversified away by investing in both Hasbro and Clarus Corp 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 Hasbro and Clarus Corp into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Hasbro Inc and Clarus Corp, you can compare the effects of market volatilities on Hasbro and Clarus Corp 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 Hasbro with a short position of Clarus Corp. Check out your portfolio center. Please also check ongoing floating volatility patterns of Hasbro and Clarus Corp.
Diversification Opportunities for Hasbro and Clarus Corp
-0.06 | Correlation Coefficient |
Good diversification
The 3 months correlation between Hasbro and Clarus is -0.06. Overlapping area represents the amount of risk that can be diversified away by holding Hasbro Inc and Clarus Corp in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Clarus Corp and Hasbro 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 Hasbro Inc are associated (or correlated) with Clarus Corp. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Clarus Corp has no effect on the direction of Hasbro i.e., Hasbro and Clarus Corp go up and down completely randomly.
Pair Corralation between Hasbro and Clarus Corp
Considering the 90-day investment horizon Hasbro is expected to generate 5.99 times less return on investment than Clarus Corp. But when comparing it to its historical volatility, Hasbro Inc is 2.56 times less risky than Clarus Corp. It trades about 0.08 of its potential returns per unit of risk. Clarus Corp is currently generating about 0.18 of returns per unit of risk over similar time horizon. If you would invest 438.00 in Clarus Corp on September 13, 2024 and sell it today you would earn a total of 59.00 from holding Clarus Corp or generate 13.47% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Hasbro Inc vs. Clarus Corp
Performance |
| Timeline |
| Hasbro Inc |
| Clarus Corp |
Hasbro and Clarus Corp Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Hasbro and Clarus Corp
The main advantage of trading using opposite Hasbro and Clarus Corp positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Hasbro position performs unexpectedly, Clarus Corp 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 Clarus Corp will offset losses from the drop in Clarus Corp's long position.| Hasbro vs. Clarus Corp | Hasbro vs. Johnson Outdoors | Hasbro vs. JAKKS Pacific | Hasbro vs. OneSpaWorld Holdings |
| Clarus Corp vs. Johnson Outdoors | Clarus Corp vs. Escalade Incorporated | Clarus Corp vs. JAKKS Pacific | Clarus Corp vs. Six Flags Entertainment |
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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