Correlation Between Honey Badger and Arctic Star
Can any of the company-specific risk be diversified away by investing in both Honey Badger and Arctic Star 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 Honey Badger and Arctic Star into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Honey Badger Silver and Arctic Star Exploration, you can compare the effects of market volatilities on Honey Badger and Arctic Star 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 Honey Badger with a short position of Arctic Star. Check out your portfolio center. Please also check ongoing floating volatility patterns of Honey Badger and Arctic Star.
Diversification Opportunities for Honey Badger and Arctic Star
-0.11 | Correlation Coefficient |
Good diversification
The 3 months correlation between Honey and Arctic is -0.11. Overlapping area represents the amount of risk that can be diversified away by holding Honey Badger Silver and Arctic Star Exploration in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Arctic Star Exploration and Honey Badger 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 Honey Badger Silver are associated (or correlated) with Arctic Star. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Arctic Star Exploration has no effect on the direction of Honey Badger i.e., Honey Badger and Arctic Star go up and down completely randomly.
Pair Corralation between Honey Badger and Arctic Star
Assuming the 90 days horizon Honey Badger Silver is expected to generate 2.24 times more return on investment than Arctic Star. However, Honey Badger is 2.24 times more volatile than Arctic Star Exploration. It trades about 0.05 of its potential returns per unit of risk. Arctic Star Exploration is currently generating about 0.03 per unit of risk. If you would invest 2.40 in Honey Badger Silver on September 2, 2024 and sell it today you would earn a total of 5.54 from holding Honey Badger Silver or generate 230.83% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Honey Badger Silver vs. Arctic Star Exploration
Performance |
| Timeline |
| Honey Badger Silver |
| Arctic Star Exploration |
Honey Badger and Arctic Star Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Honey Badger and Arctic Star
The main advantage of trading using opposite Honey Badger and Arctic Star positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Honey Badger position performs unexpectedly, Arctic Star 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 Arctic Star will offset losses from the drop in Arctic Star's long position.| Honey Badger vs. HUMANA INC | Honey Badger vs. SCOR PK | Honey Badger vs. Aquagold International | Honey Badger vs. Thrivent High Yield |
| Arctic Star vs. American Sierra Gold | Arctic Star vs. Aurania Resources | Arctic Star vs. Alien Metals | Arctic Star vs. Gold79 Mines |
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 Volatility Analysis module to get historical volatility and risk analysis based on latest market data.
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