Correlation Between Hims Hers and Kimberly Clark
Can any of the company-specific risk be diversified away by investing in both Hims Hers and Kimberly Clark 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 Hims Hers and Kimberly Clark into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Hims Hers Health and Kimberly Clark, you can compare the effects of market volatilities on Hims Hers and Kimberly Clark 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 Hims Hers with a short position of Kimberly Clark. Check out your portfolio center. Please also check ongoing floating volatility patterns of Hims Hers and Kimberly Clark.
Diversification Opportunities for Hims Hers and Kimberly Clark
-0.67 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between Hims and Kimberly is -0.67. Overlapping area represents the amount of risk that can be diversified away by holding Hims Hers Health and Kimberly Clark in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Kimberly Clark and Hims Hers 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 Hims Hers Health are associated (or correlated) with Kimberly Clark. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Kimberly Clark has no effect on the direction of Hims Hers i.e., Hims Hers and Kimberly Clark go up and down completely randomly.
Pair Corralation between Hims Hers and Kimberly Clark
Given the investment horizon of 90 days Hims Hers Health is expected to generate 12.03 times more return on investment than Kimberly Clark. However, Hims Hers is 12.03 times more volatile than Kimberly Clark. It trades about 0.19 of its potential returns per unit of risk. Kimberly Clark is currently generating about 0.14 per unit of risk. If you would invest 2,308 in Hims Hers Health on August 27, 2024 and sell it today you would earn a total of 827.00 from holding Hims Hers Health or generate 35.83% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Hims Hers Health vs. Kimberly Clark
Performance |
| Timeline |
| Hims Hers Health |
| Kimberly Clark |
Hims Hers and Kimberly Clark Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Hims Hers and Kimberly Clark
The main advantage of trading using opposite Hims Hers and Kimberly Clark positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Hims Hers position performs unexpectedly, Kimberly Clark 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 Kimberly Clark will offset losses from the drop in Kimberly Clark's long position.| Hims Hers vs. ELF Beauty | Hims Hers vs. Newell Brands | Hims Hers vs. Virgin Group Acquisition | Hims Hers vs. Estee Lauder Companies |
| Kimberly Clark vs. Unilever PLC ADR | Kimberly Clark vs. Estee Lauder Companies | Kimberly Clark vs. ELF Beauty | Kimberly Clark vs. Coty Inc |
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 Economic Indicators module to top statistical indicators that provide insights into how an economy is performing.
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