Correlation Between Highway Holdings and Bonso Electronics
Can any of the company-specific risk be diversified away by investing in both Highway Holdings and Bonso Electronics 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 Highway Holdings and Bonso Electronics into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Highway Holdings Limited and Bonso Electronics International, you can compare the effects of market volatilities on Highway Holdings and Bonso Electronics 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 Highway Holdings with a short position of Bonso Electronics. Check out your portfolio center. Please also check ongoing floating volatility patterns of Highway Holdings and Bonso Electronics.
Diversification Opportunities for Highway Holdings and Bonso Electronics
-0.43 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Highway and Bonso is -0.43. Overlapping area represents the amount of risk that can be diversified away by holding Highway Holdings Limited and Bonso Electronics Internationa in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Bonso Electronics and Highway Holdings 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 Highway Holdings Limited are associated (or correlated) with Bonso Electronics. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Bonso Electronics has no effect on the direction of Highway Holdings i.e., Highway Holdings and Bonso Electronics go up and down completely randomly.
Pair Corralation between Highway Holdings and Bonso Electronics
If you would invest 191.00 in Highway Holdings Limited on August 28, 2024 and sell it today you would earn a total of 2.00 from holding Highway Holdings Limited or generate 1.05% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 4.76% |
| Values | Daily Returns |
Highway Holdings Limited vs. Bonso Electronics Internationa
Performance |
| Timeline |
| Highway Holdings |
| Bonso Electronics |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Very Weak
Highway Holdings and Bonso Electronics Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Highway Holdings and Bonso Electronics
The main advantage of trading using opposite Highway Holdings and Bonso Electronics positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Highway Holdings position performs unexpectedly, Bonso Electronics 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 Bonso Electronics will offset losses from the drop in Bonso Electronics' long position.| Highway Holdings vs. Deswell Industries | Highway Holdings vs. Euro Tech Holdings | Highway Holdings vs. China Natural Resources | Highway Holdings vs. Arts Way Manufacturing Co |
| Bonso Electronics vs. Cepton Inc | Bonso Electronics vs. SaverOne 2014 Ltd | Bonso Electronics vs. Genasys | Bonso Electronics vs. Kraken Robotics |
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 Stock Tickers module to use high-impact, comprehensive, and customizable stock tickers that can be easily integrated to any websites.
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