Correlation Between Hiru and SMC Entertainment
Can any of the company-specific risk be diversified away by investing in both Hiru and SMC Entertainment 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 Hiru and SMC Entertainment into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Hiru Corporation and SMC Entertainment, you can compare the effects of market volatilities on Hiru and SMC Entertainment 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 Hiru with a short position of SMC Entertainment. Check out your portfolio center. Please also check ongoing floating volatility patterns of Hiru and SMC Entertainment.
Diversification Opportunities for Hiru and SMC Entertainment
-0.09 | Correlation Coefficient |
Good diversification
The 3 months correlation between Hiru and SMC is -0.09. Overlapping area represents the amount of risk that can be diversified away by holding Hiru Corp. and SMC Entertainment in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on SMC Entertainment and Hiru 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 Hiru Corporation are associated (or correlated) with SMC Entertainment. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of SMC Entertainment has no effect on the direction of Hiru i.e., Hiru and SMC Entertainment go up and down completely randomly.
Pair Corralation between Hiru and SMC Entertainment
Given the investment horizon of 90 days Hiru is expected to generate 1.21 times less return on investment than SMC Entertainment. In addition to that, Hiru is 1.12 times more volatile than SMC Entertainment. It trades about 0.05 of its total potential returns per unit of risk. SMC Entertainment is currently generating about 0.07 per unit of volatility. If you would invest 0.13 in SMC Entertainment on October 24, 2024 and sell it today you would earn a total of 0.05 from holding SMC Entertainment or generate 38.46% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 95.38% |
| Values | Daily Returns |
Hiru Corp. vs. SMC Entertainment
Performance |
| Timeline |
| Hiru |
| SMC Entertainment |
Hiru and SMC Entertainment Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Hiru and SMC Entertainment
The main advantage of trading using opposite Hiru and SMC Entertainment positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Hiru position performs unexpectedly, SMC Entertainment 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 SMC Entertainment will offset losses from the drop in SMC Entertainment's long position.| Hiru vs. Indo Global Exchange | Hiru vs. Genesis Electronics Group | Hiru vs. Protext Mobility | Hiru vs. TonnerOne World Holdings |
| SMC Entertainment vs. One Step Vending | SMC Entertainment vs. SNM Gobal Holdings | SMC Entertainment vs. Hiru Corporation | SMC Entertainment vs. Sack Lunch Productions |
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 Portfolio Anywhere module to track or share privately all of your investments from the convenience of any device.
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