Correlation Between Highway Holdings and Presidio Property
Can any of the company-specific risk be diversified away by investing in both Highway Holdings and Presidio Property 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 Presidio Property 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 Presidio Property Trust, you can compare the effects of market volatilities on Highway Holdings and Presidio Property 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 Presidio Property. Check out your portfolio center. Please also check ongoing floating volatility patterns of Highway Holdings and Presidio Property.
Diversification Opportunities for Highway Holdings and Presidio Property
-0.11 | Correlation Coefficient |
Good diversification
The 3 months correlation between Highway and Presidio is -0.11. Overlapping area represents the amount of risk that can be diversified away by holding Highway Holdings Limited and Presidio Property Trust in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Presidio Property Trust 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 Presidio Property. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Presidio Property Trust has no effect on the direction of Highway Holdings i.e., Highway Holdings and Presidio Property go up and down completely randomly.
Pair Corralation between Highway Holdings and Presidio Property
Given the investment horizon of 90 days Highway Holdings is expected to generate 1.33 times less return on investment than Presidio Property. But when comparing it to its historical volatility, Highway Holdings Limited is 5.73 times less risky than Presidio Property. It trades about 0.17 of its potential returns per unit of risk. Presidio Property Trust is currently generating about 0.04 of returns per unit of risk over similar time horizon. If you would invest 69.00 in Presidio Property Trust on September 2, 2024 and sell it today you would earn a total of 1.00 from holding Presidio Property Trust or generate 1.45% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Highway Holdings Limited vs. Presidio Property Trust
Performance |
| Timeline |
| Highway Holdings |
| Presidio Property Trust |
Highway Holdings and Presidio Property Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Highway Holdings and Presidio Property
The main advantage of trading using opposite Highway Holdings and Presidio Property positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Highway Holdings position performs unexpectedly, Presidio Property 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 Presidio Property will offset losses from the drop in Presidio Property's 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 |
| Presidio Property vs. Re Max Holding | Presidio Property vs. Frp Holdings Ord | Presidio Property vs. Maui Land Pineapple | Presidio Property vs. Redfin Corp |
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 Competition Analyzer module to analyze and compare many basic indicators for a group of related or unrelated entities.
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