Correlation Between HSBC Holdings and ING Groep
Can any of the company-specific risk be diversified away by investing in both HSBC Holdings and ING Groep 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 HSBC Holdings and ING Groep into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between HSBC Holdings plc and ING Groep NV, you can compare the effects of market volatilities on HSBC Holdings and ING Groep 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 HSBC Holdings with a short position of ING Groep. Check out your portfolio center. Please also check ongoing floating volatility patterns of HSBC Holdings and ING Groep.
Diversification Opportunities for HSBC Holdings and ING Groep
0.0 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between HSBC and ING is 0.0. Overlapping area represents the amount of risk that can be diversified away by holding HSBC Holdings plc and ING Groep NV in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on ING Groep NV and HSBC Holdings 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 HSBC Holdings plc are associated (or correlated) with ING Groep. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of ING Groep NV has no effect on the direction of HSBC Holdings i.e., HSBC Holdings and ING Groep go up and down completely randomly.
Pair Corralation between HSBC Holdings and ING Groep
If you would invest 92,494 in HSBC Holdings plc on September 4, 2024 and sell it today you would earn a total of 1,006 from holding HSBC Holdings plc or generate 1.09% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Flat |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
HSBC Holdings plc vs. ING Groep NV
Performance |
| Timeline |
| HSBC Holdings plc |
| ING Groep NV |
HSBC Holdings and ING Groep Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with HSBC Holdings and ING Groep
The main advantage of trading using opposite HSBC Holdings and ING Groep positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if HSBC Holdings position performs unexpectedly, ING Groep 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 ING Groep will offset losses from the drop in ING Groep's long position.| HSBC Holdings vs. United States Steel | HSBC Holdings vs. FIBRA Storage | HSBC Holdings vs. Micron Technology | HSBC Holdings vs. Delta Air Lines |
| ING Groep vs. Southwest Airlines | ING Groep vs. Grupo Sports World | ING Groep vs. Prudential Financial | ING Groep vs. Taiwan Semiconductor Manufacturing |
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 Global Markets Map module to get a quick overview of global market snapshot using zoomable world map. Drill down to check world indexes.
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