Correlation Between Hitachi Metals and Kernel Group
Can any of the company-specific risk be diversified away by investing in both Hitachi Metals and Kernel Group 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 Hitachi Metals and Kernel Group into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Hitachi Metals and Kernel Group Holdings, you can compare the effects of market volatilities on Hitachi Metals and Kernel Group 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 Hitachi Metals with a short position of Kernel Group. Check out your portfolio center. Please also check ongoing floating volatility patterns of Hitachi Metals and Kernel Group.
Diversification Opportunities for Hitachi Metals and Kernel Group
-0.5 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Hitachi and Kernel is -0.5. Overlapping area represents the amount of risk that can be diversified away by holding Hitachi Metals and Kernel Group Holdings in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Kernel Group Holdings and Hitachi Metals 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 Hitachi Metals are associated (or correlated) with Kernel Group. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Kernel Group Holdings has no effect on the direction of Hitachi Metals i.e., Hitachi Metals and Kernel Group go up and down completely randomly.
Pair Corralation between Hitachi Metals and Kernel Group
If you would invest 1,030 in Kernel Group Holdings on August 30, 2024 and sell it today you would earn a total of 0.00 from holding Kernel Group Holdings or generate 0.0% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Hitachi Metals vs. Kernel Group Holdings
Performance |
| Timeline |
| Hitachi Metals |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Very Weak
| Kernel Group Holdings |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Very Weak
Hitachi Metals and Kernel Group Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Hitachi Metals and Kernel Group
The main advantage of trading using opposite Hitachi Metals and Kernel Group positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Hitachi Metals position performs unexpectedly, Kernel Group 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 Kernel Group will offset losses from the drop in Kernel Group's long position.| Hitachi Metals vs. NioCorp Developments Ltd | Hitachi Metals vs. Brandywine Realty Trust | Hitachi Metals vs. Electrovaya Common Shares | Hitachi Metals vs. Vodka Brands Corp |
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 Instant Ratings module to determine any equity ratings based on digital recommendations. Macroaxis instant equity ratings are based on combination of fundamental analysis and risk-adjusted market performance.
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