Correlation Between Halfords Group and Blackrock World
Can any of the company-specific risk be diversified away by investing in both Halfords Group and Blackrock World 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 Halfords Group and Blackrock World into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Halfords Group PLC and Blackrock World Mining, you can compare the effects of market volatilities on Halfords Group and Blackrock World 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 Halfords Group with a short position of Blackrock World. Check out your portfolio center. Please also check ongoing floating volatility patterns of Halfords Group and Blackrock World.
Diversification Opportunities for Halfords Group and Blackrock World
0.71 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Halfords and Blackrock is 0.71. Overlapping area represents the amount of risk that can be diversified away by holding Halfords Group PLC and Blackrock World Mining in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Blackrock World Mining and Halfords Group 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 Halfords Group PLC are associated (or correlated) with Blackrock World. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Blackrock World Mining has no effect on the direction of Halfords Group i.e., Halfords Group and Blackrock World go up and down completely randomly.
Pair Corralation between Halfords Group and Blackrock World
Assuming the 90 days trading horizon Halfords Group PLC is expected to generate 1.87 times more return on investment than Blackrock World. However, Halfords Group is 1.87 times more volatile than Blackrock World Mining. It trades about 0.03 of its potential returns per unit of risk. Blackrock World Mining is currently generating about 0.0 per unit of risk. If you would invest 13,424 in Halfords Group PLC on November 3, 2024 and sell it today you would earn a total of 736.00 from holding Halfords Group PLC or generate 5.48% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Halfords Group PLC vs. Blackrock World Mining
Performance |
| Timeline |
| Halfords Group PLC |
| Blackrock World Mining |
Halfords Group and Blackrock World Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Halfords Group and Blackrock World
The main advantage of trading using opposite Halfords Group and Blackrock World positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Halfords Group position performs unexpectedly, Blackrock World 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 Blackrock World will offset losses from the drop in Blackrock World's long position.| Halfords Group vs. AMG Advanced Metallurgical | Halfords Group vs. Jupiter Fund Management | Halfords Group vs. BE Semiconductor Industries | Halfords Group vs. Ebro Foods |
| Blackrock World vs. Canadian General Investments | Blackrock World vs. Travel Leisure Co | Blackrock World vs. Mobius Investment Trust | Blackrock World vs. Indutrade AB |
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 Investing Opportunities module to build portfolios using our predefined set of ideas and optimize them against your investing preferences.
Other Complementary Tools
| Price Transformation Use Price Transformation models to analyze the depth of different equity instruments across global markets | |
| Idea Optimizer Use advanced portfolio builder with pre-computed micro ideas to build optimal portfolio | |
| Price Exposure Probability Analyze equity upside and downside potential for a given time horizon across multiple markets | |
| Portfolio Center All portfolio management and optimization tools to improve performance of your portfolios | |
| Portfolio Holdings Check your current holdings and cash postion to detemine if your portfolio needs rebalancing |