Correlation Between Hrcules SA and HAGA SA
Can any of the company-specific risk be diversified away by investing in both Hrcules SA and HAGA SA 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 Hrcules SA and HAGA SA into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Hrcules SA and HAGA SA Indstria, you can compare the effects of market volatilities on Hrcules SA and HAGA SA 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 Hrcules SA with a short position of HAGA SA. Check out your portfolio center. Please also check ongoing floating volatility patterns of Hrcules SA and HAGA SA.
Diversification Opportunities for Hrcules SA and HAGA SA
0.11 | Correlation Coefficient |
Average diversification
The 3 months correlation between Hrcules and HAGA is 0.11. Overlapping area represents the amount of risk that can be diversified away by holding Hrcules SA and HAGA SA Indstria in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on HAGA SA Indstria and Hrcules SA 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 Hrcules SA are associated (or correlated) with HAGA SA. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of HAGA SA Indstria has no effect on the direction of Hrcules SA i.e., Hrcules SA and HAGA SA go up and down completely randomly.
Pair Corralation between Hrcules SA and HAGA SA
Assuming the 90 days trading horizon Hrcules SA is expected to generate 1.83 times more return on investment than HAGA SA. However, Hrcules SA is 1.83 times more volatile than HAGA SA Indstria. It trades about 0.01 of its potential returns per unit of risk. HAGA SA Indstria is currently generating about 0.02 per unit of risk. If you would invest 683.00 in Hrcules SA on September 2, 2024 and sell it today you would lose (35.00) from holding Hrcules SA or give up 5.12% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 99.6% |
| Values | Daily Returns |
Hrcules SA vs. HAGA SA Indstria
Performance |
| Timeline |
| Hrcules SA |
| HAGA SA Indstria |
Hrcules SA and HAGA SA Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Hrcules SA and HAGA SA
The main advantage of trading using opposite Hrcules SA and HAGA SA positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Hrcules SA position performs unexpectedly, HAGA SA 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 HAGA SA will offset losses from the drop in HAGA SA's long position.| Hrcules SA vs. Inepar SA Indstria | Hrcules SA vs. Lupatech SA | Hrcules SA vs. Rossi Residencial SA | Hrcules SA vs. Fras le SA |
| HAGA SA vs. Fras le SA | HAGA SA vs. PBG SA | HAGA SA vs. Springs Global Participaes | HAGA SA vs. Indstrias Romi SA |
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 Performance Analysis module to check effects of mean-variance optimization against your current asset allocation.
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