Correlation Between Highlight Communications and FIH MOBILE
Can any of the company-specific risk be diversified away by investing in both Highlight Communications and FIH MOBILE 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 FIH MOBILE 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 FIH MOBILE, you can compare the effects of market volatilities on Highlight Communications and FIH MOBILE 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 FIH MOBILE. Check out your portfolio center. Please also check ongoing floating volatility patterns of Highlight Communications and FIH MOBILE.
Diversification Opportunities for Highlight Communications and FIH MOBILE
0.5 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Highlight and FIH is 0.5. Overlapping area represents the amount of risk that can be diversified away by holding Highlight Communications AG and FIH MOBILE in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on FIH MOBILE 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 FIH MOBILE. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of FIH MOBILE has no effect on the direction of Highlight Communications i.e., Highlight Communications and FIH MOBILE go up and down completely randomly.
Pair Corralation between Highlight Communications and FIH MOBILE
Assuming the 90 days trading horizon Highlight Communications AG is expected to under-perform the FIH MOBILE. In addition to that, Highlight Communications is 1.5 times more volatile than FIH MOBILE. It trades about -0.05 of its total potential returns per unit of risk. FIH MOBILE is currently generating about 0.05 per unit of volatility. If you would invest 6.85 in FIH MOBILE on November 7, 2024 and sell it today you would earn a total of 1.85 from holding FIH MOBILE or generate 27.01% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Highlight Communications AG vs. FIH MOBILE
Performance |
| Timeline |
| Highlight Communications |
| FIH MOBILE |
Highlight Communications and FIH MOBILE Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Highlight Communications and FIH MOBILE
The main advantage of trading using opposite Highlight Communications and FIH MOBILE positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Highlight Communications position performs unexpectedly, FIH MOBILE 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 FIH MOBILE will offset losses from the drop in FIH MOBILE's long position.| Highlight Communications vs. OAKTRSPECLENDNEW | Highlight Communications vs. Khiron Life Sciences | Highlight Communications vs. UNICREDIT SPA ADR | Highlight Communications vs. United States Steel |
| FIH MOBILE vs. Columbia Sportswear | FIH MOBILE vs. FRACTAL GAMING GROUP | FIH MOBILE vs. LG Display Co | FIH MOBILE vs. PLAYTIKA HOLDING DL 01 |
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 Insider Screener module to find insiders across different sectors to evaluate their impact on performance.
Other Complementary Tools
| Price Exposure Probability Analyze equity upside and downside potential for a given time horizon across multiple markets | |
| Cryptocurrency Center Build and monitor diversified portfolio of extremely risky digital assets and cryptocurrency | |
| ETFs Find actively traded Exchange Traded Funds (ETF) from around the world | |
| Theme Ratings Determine theme ratings based on digital equity recommendations. Macroaxis theme ratings are based on combination of fundamental analysis and risk-adjusted market performance | |
| Portfolio Rebalancing Analyze risk-adjusted returns against different time horizons to find asset-allocation targets |