Correlation Between Harte Hanks and Compass Diversified
Can any of the company-specific risk be diversified away by investing in both Harte Hanks and Compass Diversified 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 Harte Hanks and Compass Diversified into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Harte Hanks and Compass Diversified, you can compare the effects of market volatilities on Harte Hanks and Compass Diversified 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 Harte Hanks with a short position of Compass Diversified. Check out your portfolio center. Please also check ongoing floating volatility patterns of Harte Hanks and Compass Diversified.
Diversification Opportunities for Harte Hanks and Compass Diversified
0.73 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Harte and Compass is 0.73. Overlapping area represents the amount of risk that can be diversified away by holding Harte Hanks and Compass Diversified in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Compass Diversified and Harte Hanks 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 Harte Hanks are associated (or correlated) with Compass Diversified. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Compass Diversified has no effect on the direction of Harte Hanks i.e., Harte Hanks and Compass Diversified go up and down completely randomly.
Pair Corralation between Harte Hanks and Compass Diversified
Considering the 90-day investment horizon Harte Hanks is expected to under-perform the Compass Diversified. In addition to that, Harte Hanks is 5.5 times more volatile than Compass Diversified. It trades about -0.34 of its total potential returns per unit of risk. Compass Diversified is currently generating about -0.44 per unit of volatility. If you would invest 2,420 in Compass Diversified on August 27, 2024 and sell it today you would lose (120.00) from holding Compass Diversified or give up 4.96% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Harte Hanks vs. Compass Diversified
Performance |
| Timeline |
| Harte Hanks |
| Compass Diversified |
Harte Hanks and Compass Diversified Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Harte Hanks and Compass Diversified
The main advantage of trading using opposite Harte Hanks and Compass Diversified positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Harte Hanks position performs unexpectedly, Compass Diversified 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 Compass Diversified will offset losses from the drop in Compass Diversified's long position.| Harte Hanks vs. FTAI Infrastructure | Harte Hanks vs. Steel Partners Holdings | Harte Hanks vs. Mammoth Energy Services | Harte Hanks vs. Seaboard |
| Compass Diversified vs. Steel Partners Holdings | Compass Diversified vs. Steel Partners Holdings | Compass Diversified vs. Tejon Ranch Co | Compass Diversified vs. Brookfield Business Partners |
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 My Watchlist Analysis module to analyze my current watchlist and to refresh optimization strategy. Macroaxis watchlist is based on self-learning algorithm to remember stocks you like.
Other Complementary Tools
| Insider Screener Find insiders across different sectors to evaluate their impact on performance | |
| Global Correlations Find global opportunities by holding instruments from different markets | |
| Piotroski F Score Get Piotroski F Score based on the binary analysis strategy of nine different fundamentals | |
| Portfolio File Import Quickly import all of your third-party portfolios from your local drive in csv format | |
| Risk-Return Analysis View associations between returns expected from investment and the risk you assume |