Correlation Between HK Metals and Ace Hardware
Can any of the company-specific risk be diversified away by investing in both HK Metals and Ace Hardware 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 HK Metals and Ace Hardware into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between HK Metals Utama and Ace Hardware Indonesia, you can compare the effects of market volatilities on HK Metals and Ace Hardware 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 HK Metals with a short position of Ace Hardware. Check out your portfolio center. Please also check ongoing floating volatility patterns of HK Metals and Ace Hardware.
Diversification Opportunities for HK Metals and Ace Hardware
0.0 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between HKMU and Ace is 0.0. Overlapping area represents the amount of risk that can be diversified away by holding HK Metals Utama and Ace Hardware Indonesia in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Ace Hardware Indonesia and HK Metals 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 HK Metals Utama are associated (or correlated) with Ace Hardware. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Ace Hardware Indonesia has no effect on the direction of HK Metals i.e., HK Metals and Ace Hardware go up and down completely randomly.
Pair Corralation between HK Metals and Ace Hardware
If you would invest 70,156 in Ace Hardware Indonesia on November 28, 2024 and sell it today you would lose (656.00) from holding Ace Hardware Indonesia or give up 0.94% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Flat |
| Strength | Insignificant |
| Accuracy | 99.73% |
| Values | Daily Returns |
HK Metals Utama vs. Ace Hardware Indonesia
Performance |
| Timeline |
| HK Metals Utama |
| Ace Hardware Indonesia |
HK Metals and Ace Hardware Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with HK Metals and Ace Hardware
The main advantage of trading using opposite HK Metals and Ace Hardware positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if HK Metals position performs unexpectedly, Ace Hardware 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 Ace Hardware will offset losses from the drop in Ace Hardware's long position.| HK Metals vs. PT Indonesia Kendaraan | HK Metals vs. Wijaya Karya Bangunan | HK Metals vs. Buyung Poetra Sembada | HK Metals vs. J Resources Asia |
| Ace Hardware vs. Japfa Comfeed Indonesia | Ace Hardware vs. Charoen Pokphand Indonesia | Ace Hardware vs. Erajaya Swasembada Tbk | Ace Hardware vs. Indofood Cbp Sukses |
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 Idea Optimizer module to use advanced portfolio builder with pre-computed micro ideas to build optimal portfolio .
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