Correlation Between Hamilton Enhanced and Harvest Equal
Can any of the company-specific risk be diversified away by investing in both Hamilton Enhanced and Harvest Equal 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 Hamilton Enhanced and Harvest Equal into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Hamilton Enhanced Canadian and Harvest Equal Weight, you can compare the effects of market volatilities on Hamilton Enhanced and Harvest Equal 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 Hamilton Enhanced with a short position of Harvest Equal. Check out your portfolio center. Please also check ongoing floating volatility patterns of Hamilton Enhanced and Harvest Equal.
Diversification Opportunities for Hamilton Enhanced and Harvest Equal
0.77 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Hamilton and Harvest is 0.77. Overlapping area represents the amount of risk that can be diversified away by holding Hamilton Enhanced Canadian and Harvest Equal Weight in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Harvest Equal Weight and Hamilton Enhanced 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 Hamilton Enhanced Canadian are associated (or correlated) with Harvest Equal. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Harvest Equal Weight has no effect on the direction of Hamilton Enhanced i.e., Hamilton Enhanced and Harvest Equal go up and down completely randomly.
Pair Corralation between Hamilton Enhanced and Harvest Equal
Assuming the 90 days trading horizon Hamilton Enhanced Canadian is expected to generate 1.12 times more return on investment than Harvest Equal. However, Hamilton Enhanced is 1.12 times more volatile than Harvest Equal Weight. It trades about 0.09 of its potential returns per unit of risk. Harvest Equal Weight is currently generating about 0.05 per unit of risk. If you would invest 1,724 in Hamilton Enhanced Canadian on September 12, 2024 and sell it today you would earn a total of 838.00 from holding Hamilton Enhanced Canadian or generate 48.61% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Hamilton Enhanced Canadian vs. Harvest Equal Weight
Performance |
| Timeline |
| Hamilton Enhanced |
| Harvest Equal Weight |
Hamilton Enhanced and Harvest Equal Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Hamilton Enhanced and Harvest Equal
The main advantage of trading using opposite Hamilton Enhanced and Harvest Equal positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Hamilton Enhanced position performs unexpectedly, Harvest Equal 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 Harvest Equal will offset losses from the drop in Harvest Equal's long position.| Hamilton Enhanced vs. Hamilton Enhanced Multi Sector | Hamilton Enhanced vs. Hamilton Enhanced Covered | Hamilton Enhanced vs. Hamilton Canadian Financials | Hamilton Enhanced vs. Harvest Diversified Monthly |
| Harvest Equal vs. Hamilton Enhanced Covered | Harvest Equal vs. Hamilton Enhanced Multi Sector | Harvest Equal vs. Hamilton Canadian Financials | Harvest Equal vs. Real Estate E Commerce |
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 Technical Analysis module to check basic technical indicators and analysis based on most latest market data.
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