Correlation Between HM Inwest and Inpro SA
Can any of the company-specific risk be diversified away by investing in both HM Inwest and Inpro SA 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 Inpro SA 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 Inpro SA, you can compare the effects of market volatilities on HM Inwest and Inpro SA 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 Inpro SA. Check out your portfolio center. Please also check ongoing floating volatility patterns of HM Inwest and Inpro SA.
Diversification Opportunities for HM Inwest and Inpro SA
Pay attention - limited upside
The 3 months correlation between HMI and Inpro is -0.85. Overlapping area represents the amount of risk that can be diversified away by holding HM Inwest SA and Inpro SA in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Inpro SA 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 Inpro SA. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Inpro SA has no effect on the direction of HM Inwest i.e., HM Inwest and Inpro SA go up and down completely randomly.
Pair Corralation between HM Inwest and Inpro SA
Assuming the 90 days trading horizon HM Inwest SA is expected to under-perform the Inpro SA. But the stock apears to be less risky and, when comparing its historical volatility, HM Inwest SA is 1.91 times less risky than Inpro SA. The stock trades about -0.29 of its potential returns per unit of risk. The Inpro SA is currently generating about -0.06 of returns per unit of risk over similar time horizon. If you would invest 640.00 in Inpro SA on September 13, 2024 and sell it today you would lose (20.00) from holding Inpro SA or give up 3.12% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
HM Inwest SA vs. Inpro SA
Performance |
| Timeline |
| HM Inwest SA |
| Inpro SA |
HM Inwest and Inpro SA Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with HM Inwest and Inpro SA
The main advantage of trading using opposite HM Inwest and Inpro SA positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if HM Inwest position performs unexpectedly, Inpro SA 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 Inpro SA will offset losses from the drop in Inpro SA's long position.| HM Inwest vs. Banco Santander SA | HM Inwest vs. UniCredit SpA | HM Inwest vs. CEZ as | HM Inwest vs. Polski Koncern Naftowy |
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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 Transaction History module to view history of all your transactions and understand their impact on performance.
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