Correlation Between Hawsons Iron and Credit Corp
Can any of the company-specific risk be diversified away by investing in both Hawsons Iron and Credit Corp 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 Hawsons Iron and Credit Corp into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Hawsons Iron and Credit Corp Group, you can compare the effects of market volatilities on Hawsons Iron and Credit Corp 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 Hawsons Iron with a short position of Credit Corp. Check out your portfolio center. Please also check ongoing floating volatility patterns of Hawsons Iron and Credit Corp.
Diversification Opportunities for Hawsons Iron and Credit Corp
-0.27 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Hawsons and Credit is -0.27. Overlapping area represents the amount of risk that can be diversified away by holding Hawsons Iron and Credit Corp Group in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Credit Corp Group and Hawsons Iron 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 Hawsons Iron are associated (or correlated) with Credit Corp. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Credit Corp Group has no effect on the direction of Hawsons Iron i.e., Hawsons Iron and Credit Corp go up and down completely randomly.
Pair Corralation between Hawsons Iron and Credit Corp
Assuming the 90 days trading horizon Hawsons Iron is expected to under-perform the Credit Corp. In addition to that, Hawsons Iron is 2.01 times more volatile than Credit Corp Group. It trades about -0.05 of its total potential returns per unit of risk. Credit Corp Group is currently generating about 0.05 per unit of volatility. If you would invest 1,297 in Credit Corp Group on September 14, 2024 and sell it today you would earn a total of 338.00 from holding Credit Corp Group or generate 26.06% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Hawsons Iron vs. Credit Corp Group
Performance |
| Timeline |
| Hawsons Iron |
| Credit Corp Group |
Hawsons Iron and Credit Corp Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Hawsons Iron and Credit Corp
The main advantage of trading using opposite Hawsons Iron and Credit Corp positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Hawsons Iron position performs unexpectedly, Credit Corp 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 Credit Corp will offset losses from the drop in Credit Corp's long position.| Hawsons Iron vs. Northern Star Resources | Hawsons Iron vs. Evolution Mining | Hawsons Iron vs. Bluescope Steel | Hawsons Iron vs. Sandfire Resources NL |
| Credit Corp vs. Hawsons Iron | Credit Corp vs. Skycity Entertainment Group | Credit Corp vs. Red Hill Iron | Credit Corp vs. Bisalloy Steel Group |
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 Money Managers module to screen money managers from public funds and ETFs managed around the world.
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