Correlation Between HM Inwest and Astarta Holding
Can any of the company-specific risk be diversified away by investing in both HM Inwest and Astarta Holding 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 HM Inwest and Astarta Holding into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between HM Inwest SA and Astarta Holding NV, you can compare the effects of market volatilities on HM Inwest and Astarta Holding 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 HM Inwest with a short position of Astarta Holding. Check out your portfolio center. Please also check ongoing floating volatility patterns of HM Inwest and Astarta Holding.
Diversification Opportunities for HM Inwest and Astarta Holding
0.41 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between HMI and Astarta is 0.41. Overlapping area represents the amount of risk that can be diversified away by holding HM Inwest SA and Astarta Holding NV in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Astarta Holding NV and HM Inwest 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 HM Inwest SA are associated (or correlated) with Astarta Holding. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Astarta Holding NV has no effect on the direction of HM Inwest i.e., HM Inwest and Astarta Holding go up and down completely randomly.
Pair Corralation between HM Inwest and Astarta Holding
Assuming the 90 days trading horizon HM Inwest is expected to generate 1.26 times less return on investment than Astarta Holding. In addition to that, HM Inwest is 1.58 times more volatile than Astarta Holding NV. It trades about 0.13 of its total potential returns per unit of risk. Astarta Holding NV is currently generating about 0.25 per unit of volatility. If you would invest 2,960 in Astarta Holding NV on September 12, 2024 and sell it today you would earn a total of 1,120 from holding Astarta Holding NV or generate 37.84% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
HM Inwest SA vs. Astarta Holding NV
Performance |
| Timeline |
| HM Inwest SA |
| Astarta Holding NV |
HM Inwest and Astarta Holding Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with HM Inwest and Astarta Holding
The main advantage of trading using opposite HM Inwest and Astarta Holding positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if HM Inwest position performs unexpectedly, Astarta Holding 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 Astarta Holding will offset losses from the drop in Astarta Holding's long position.| HM Inwest vs. Bank Millennium SA | HM Inwest vs. Echo Investment SA | HM Inwest vs. PZ Cormay SA | HM Inwest vs. Intersport Polska SA |
| Astarta Holding vs. LSI Software SA | Astarta Holding vs. Saule Technologies SA | Astarta Holding vs. Immobile | Astarta Holding vs. Enter Air SA |
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 Sectors module to list of equity sectors categorizing publicly traded companies based on their primary business activities.
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