Correlation Between Highlight Communications and VIRGIN WINES
Can any of the company-specific risk be diversified away by investing in both Highlight Communications and VIRGIN WINES 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 Highlight Communications and VIRGIN WINES into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Highlight Communications AG and VIRGIN WINES UK, you can compare the effects of market volatilities on Highlight Communications and VIRGIN WINES 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 Highlight Communications with a short position of VIRGIN WINES. Check out your portfolio center. Please also check ongoing floating volatility patterns of Highlight Communications and VIRGIN WINES.
Diversification Opportunities for Highlight Communications and VIRGIN WINES
0.0 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between Highlight and VIRGIN is 0.0. Overlapping area represents the amount of risk that can be diversified away by holding Highlight Communications AG and VIRGIN WINES UK in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on VIRGIN WINES UK and Highlight Communications 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 Highlight Communications AG are associated (or correlated) with VIRGIN WINES. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of VIRGIN WINES UK has no effect on the direction of Highlight Communications i.e., Highlight Communications and VIRGIN WINES go up and down completely randomly.
Pair Corralation between Highlight Communications and VIRGIN WINES
If you would invest 114.00 in Highlight Communications AG on October 29, 2024 and sell it today you would earn a total of 35.00 from holding Highlight Communications AG or generate 30.7% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Flat |
| Strength | Insignificant |
| Accuracy | 90.0% |
| Values | Daily Returns |
Highlight Communications AG vs. VIRGIN WINES UK
Performance |
| Timeline |
| Highlight Communications |
| VIRGIN WINES UK |
Highlight Communications and VIRGIN WINES Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Highlight Communications and VIRGIN WINES
The main advantage of trading using opposite Highlight Communications and VIRGIN WINES positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Highlight Communications position performs unexpectedly, VIRGIN WINES 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 VIRGIN WINES will offset losses from the drop in VIRGIN WINES's long position.| Highlight Communications vs. Keck Seng Investments | Highlight Communications vs. Gladstone Investment | Highlight Communications vs. CENTURIA OFFICE REIT | Highlight Communications vs. NURAN WIRELESS INC |
| VIRGIN WINES vs. Minerals Technologies | VIRGIN WINES vs. MCEWEN MINING INC | VIRGIN WINES vs. MAGNUM MINING EXP | VIRGIN WINES vs. Yanzhou Coal Mining |
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 Options Analysis module to analyze and evaluate options and option chains as a potential hedge for your portfolios.
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