Correlation Between Haleon PLC and Ion Beam
Can any of the company-specific risk be diversified away by investing in both Haleon PLC and Ion Beam 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 Haleon PLC and Ion Beam into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Haleon PLC and Ion Beam Applications, you can compare the effects of market volatilities on Haleon PLC and Ion Beam 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 Haleon PLC with a short position of Ion Beam. Check out your portfolio center. Please also check ongoing floating volatility patterns of Haleon PLC and Ion Beam.
Diversification Opportunities for Haleon PLC and Ion Beam
-0.15 | Correlation Coefficient |
Good diversification
The 3 months correlation between Haleon and Ion is -0.15. Overlapping area represents the amount of risk that can be diversified away by holding Haleon PLC and Ion Beam Applications in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Ion Beam Applications and Haleon PLC 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 Haleon PLC are associated (or correlated) with Ion Beam. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Ion Beam Applications has no effect on the direction of Haleon PLC i.e., Haleon PLC and Ion Beam go up and down completely randomly.
Pair Corralation between Haleon PLC and Ion Beam
Assuming the 90 days trading horizon Haleon PLC is expected to under-perform the Ion Beam. But the stock apears to be less risky and, when comparing its historical volatility, Haleon PLC is 3.31 times less risky than Ion Beam. The stock trades about -0.08 of its potential returns per unit of risk. The Ion Beam Applications is currently generating about 0.05 of returns per unit of risk over similar time horizon. If you would invest 1,321 in Ion Beam Applications on August 30, 2024 and sell it today you would earn a total of 65.00 from holding Ion Beam Applications or generate 4.92% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Haleon PLC vs. Ion Beam Applications
Performance |
| Timeline |
| Haleon PLC |
| Ion Beam Applications |
Haleon PLC and Ion Beam Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Haleon PLC and Ion Beam
The main advantage of trading using opposite Haleon PLC and Ion Beam positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Haleon PLC position performs unexpectedly, Ion Beam 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 Ion Beam will offset losses from the drop in Ion Beam's long position.| Haleon PLC vs. Ion Beam Applications | Haleon PLC vs. DXC Technology Co | Haleon PLC vs. Fidelity National Information | Haleon PLC vs. Automatic Data Processing |
| Ion Beam vs. Tungsten West PLC | Ion Beam vs. Argo Group Limited | Ion Beam vs. Hardide PLC | Ion Beam vs. Versarien PLC |
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 Fundamental Analysis module to view fundamental data based on most recent published financial statements.
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