Correlation Between Hawaiian Electric and T3EX Global
Can any of the company-specific risk be diversified away by investing in both Hawaiian Electric and T3EX Global 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 Hawaiian Electric and T3EX Global into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Hawaiian Electric Industries and T3EX Global Holdings, you can compare the effects of market volatilities on Hawaiian Electric and T3EX Global 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 Hawaiian Electric with a short position of T3EX Global. Check out your portfolio center. Please also check ongoing floating volatility patterns of Hawaiian Electric and T3EX Global.
Diversification Opportunities for Hawaiian Electric and T3EX Global
0.47 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Hawaiian and T3EX is 0.47. Overlapping area represents the amount of risk that can be diversified away by holding Hawaiian Electric Industries and T3EX Global Holdings in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on T3EX Global Holdings and Hawaiian Electric 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 Hawaiian Electric Industries are associated (or correlated) with T3EX Global. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of T3EX Global Holdings has no effect on the direction of Hawaiian Electric i.e., Hawaiian Electric and T3EX Global go up and down completely randomly.
Pair Corralation between Hawaiian Electric and T3EX Global
Allowing for the 90-day total investment horizon Hawaiian Electric Industries is expected to generate 5.75 times more return on investment than T3EX Global. However, Hawaiian Electric is 5.75 times more volatile than T3EX Global Holdings. It trades about 0.28 of its potential returns per unit of risk. T3EX Global Holdings is currently generating about 0.46 per unit of risk. If you would invest 934.00 in Hawaiian Electric Industries on December 9, 2024 and sell it today you would earn a total of 212.00 from holding Hawaiian Electric Industries or generate 22.7% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Hawaiian Electric Industries vs. T3EX Global Holdings
Performance |
| Timeline |
| Hawaiian Electric |
| T3EX Global Holdings |
Hawaiian Electric and T3EX Global Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Hawaiian Electric and T3EX Global
The main advantage of trading using opposite Hawaiian Electric and T3EX Global positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Hawaiian Electric position performs unexpectedly, T3EX Global 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 T3EX Global will offset losses from the drop in T3EX Global's long position.| Hawaiian Electric vs. DTE Energy | ||
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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 Content Syndication module to quickly integrate customizable finance content to your own investment portal.
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