Correlation Between HF SINCLAIR and General Mills
Can any of the company-specific risk be diversified away by investing in both HF SINCLAIR and General Mills 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 HF SINCLAIR and General Mills into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between HF SINCLAIR P and General Mills, you can compare the effects of market volatilities on HF SINCLAIR and General Mills 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 HF SINCLAIR with a short position of General Mills. Check out your portfolio center. Please also check ongoing floating volatility patterns of HF SINCLAIR and General Mills.
Diversification Opportunities for HF SINCLAIR and General Mills
-0.5 | Correlation Coefficient |
Very good diversification
The 3 months correlation between HL80 and General is -0.5. Overlapping area represents the amount of risk that can be diversified away by holding HF SINCLAIR P and General Mills in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on General Mills and HF SINCLAIR 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 HF SINCLAIR P are associated (or correlated) with General Mills. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of General Mills has no effect on the direction of HF SINCLAIR i.e., HF SINCLAIR and General Mills go up and down completely randomly.
Pair Corralation between HF SINCLAIR and General Mills
Assuming the 90 days trading horizon HF SINCLAIR P is expected to under-perform the General Mills. In addition to that, HF SINCLAIR is 1.22 times more volatile than General Mills. It trades about -0.05 of its total potential returns per unit of risk. General Mills is currently generating about 0.06 per unit of volatility. If you would invest 7,060 in General Mills on September 12, 2024 and sell it today you would earn a total of 1,787 from holding General Mills or generate 25.31% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 99.6% |
| Values | Daily Returns |
HF SINCLAIR P vs. General Mills
Performance |
| Timeline |
| HF SINCLAIR P |
| General Mills |
HF SINCLAIR and General Mills Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with HF SINCLAIR and General Mills
The main advantage of trading using opposite HF SINCLAIR and General Mills positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if HF SINCLAIR position performs unexpectedly, General Mills 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 General Mills will offset losses from the drop in General Mills' long position.| HF SINCLAIR vs. Superior Plus Corp | HF SINCLAIR vs. SIVERS SEMICONDUCTORS AB | HF SINCLAIR vs. Norsk Hydro ASA | HF SINCLAIR vs. Reliance Steel Aluminum |
| General Mills vs. HF SINCLAIR P | General Mills vs. Pentair plc | General Mills vs. Playtech plc | General Mills vs. Ming Le Sports |
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 Commodity Channel module to use Commodity Channel Index to analyze current equity momentum.
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