Correlation Between Haydale Graphene and Green Star
Can any of the company-specific risk be diversified away by investing in both Haydale Graphene and Green 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 Haydale Graphene and Green Star into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Haydale Graphene Industries and Green Star Products, you can compare the effects of market volatilities on Haydale Graphene and Green 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 Haydale Graphene with a short position of Green Star. Check out your portfolio center. Please also check ongoing floating volatility patterns of Haydale Graphene and Green Star.
Diversification Opportunities for Haydale Graphene and Green Star
-0.49 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Haydale and Green is -0.49. Overlapping area represents the amount of risk that can be diversified away by holding Haydale Graphene Industries and Green Star Products in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Green Star Products and Haydale Graphene 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 Haydale Graphene Industries are associated (or correlated) with Green Star. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Green Star Products has no effect on the direction of Haydale Graphene i.e., Haydale Graphene and Green Star go up and down completely randomly.
Pair Corralation between Haydale Graphene and Green Star
Assuming the 90 days horizon Haydale Graphene Industries is expected to generate 2.01 times more return on investment than Green Star. However, Haydale Graphene is 2.01 times more volatile than Green Star Products. It trades about 0.2 of its potential returns per unit of risk. Green Star Products is currently generating about 0.08 per unit of risk. If you would invest 0.20 in Haydale Graphene Industries on August 30, 2024 and sell it today you would earn a total of 0.12 from holding Haydale Graphene Industries or generate 60.0% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Haydale Graphene Industries vs. Green Star Products
Performance |
| Timeline |
| Haydale Graphene Ind |
| Green Star Products |
Haydale Graphene and Green Star Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Haydale Graphene and Green Star
The main advantage of trading using opposite Haydale Graphene and Green Star positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Haydale Graphene position performs unexpectedly, Green 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 Green Star will offset losses from the drop in Green Star's long position.| Haydale Graphene vs. Akzo Nobel NV | Haydale Graphene vs. Avoca LLC | Haydale Graphene vs. Arkema SA ADR | Haydale Graphene vs. HUMANA INC |
| Green Star vs. Akzo Nobel NV | Green Star vs. Avoca LLC | Green Star vs. Arkema SA ADR | Green Star vs. HUMANA INC |
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 Portfolio Diagnostics module to use generated alerts and portfolio events aggregator to diagnose current holdings.
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