Correlation Between Houlihan Lokey and Top KingWin
Can any of the company-specific risk be diversified away by investing in both Houlihan Lokey and Top KingWin 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 Houlihan Lokey and Top KingWin into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Houlihan Lokey and Top KingWin Ltd, you can compare the effects of market volatilities on Houlihan Lokey and Top KingWin 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 Houlihan Lokey with a short position of Top KingWin. Check out your portfolio center. Please also check ongoing floating volatility patterns of Houlihan Lokey and Top KingWin.
Diversification Opportunities for Houlihan Lokey and Top KingWin
0.81 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between Houlihan and Top is 0.81. Overlapping area represents the amount of risk that can be diversified away by holding Houlihan Lokey and Top KingWin Ltd in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Top KingWin and Houlihan Lokey 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 Houlihan Lokey are associated (or correlated) with Top KingWin. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Top KingWin has no effect on the direction of Houlihan Lokey i.e., Houlihan Lokey and Top KingWin go up and down completely randomly.
Pair Corralation between Houlihan Lokey and Top KingWin
Considering the 90-day investment horizon Houlihan Lokey is expected to generate 0.16 times more return on investment than Top KingWin. However, Houlihan Lokey is 6.09 times less risky than Top KingWin. It trades about 0.16 of its potential returns per unit of risk. Top KingWin Ltd is currently generating about -0.01 per unit of risk. If you would invest 10,641 in Houlihan Lokey on August 26, 2024 and sell it today you would earn a total of 8,233 from holding Houlihan Lokey or generate 77.37% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Strong |
| Accuracy | 89.96% |
| Values | Daily Returns |
Houlihan Lokey vs. Top KingWin Ltd
Performance |
| Timeline |
| Houlihan Lokey |
| Top KingWin |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Solid
Houlihan Lokey and Top KingWin Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Houlihan Lokey and Top KingWin
The main advantage of trading using opposite Houlihan Lokey and Top KingWin positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Houlihan Lokey position performs unexpectedly, Top KingWin 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 Top KingWin will offset losses from the drop in Top KingWin's long position.| Houlihan Lokey vs. Lazard | Houlihan Lokey vs. PJT Partners | Houlihan Lokey vs. Moelis Co | Houlihan Lokey vs. Piper Sandler Companies |
| Top KingWin vs. Stepan Company | Top KingWin vs. Amgen Inc | Top KingWin vs. Codexis | Top KingWin vs. CVR Partners LP |
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 Breakdown module to analyze constituents of all Macroaxis ideas. Macroaxis investment ideas are predefined, sector-focused investing themes.
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