Correlation Between Hanover Foods and Mondee Holdings
Can any of the company-specific risk be diversified away by investing in both Hanover Foods and Mondee Holdings 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 Hanover Foods and Mondee Holdings into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Hanover Foods and Mondee Holdings, you can compare the effects of market volatilities on Hanover Foods and Mondee Holdings 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 Hanover Foods with a short position of Mondee Holdings. Check out your portfolio center. Please also check ongoing floating volatility patterns of Hanover Foods and Mondee Holdings.
Diversification Opportunities for Hanover Foods and Mondee Holdings
0.05 | Correlation Coefficient |
Significant diversification
The 3 months correlation between Hanover and Mondee is 0.05. Overlapping area represents the amount of risk that can be diversified away by holding Hanover Foods and Mondee Holdings in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Mondee Holdings and Hanover Foods 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 Hanover Foods are associated (or correlated) with Mondee Holdings. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Mondee Holdings has no effect on the direction of Hanover Foods i.e., Hanover Foods and Mondee Holdings go up and down completely randomly.
Pair Corralation between Hanover Foods and Mondee Holdings
Assuming the 90 days horizon Hanover Foods is expected to generate 0.28 times more return on investment than Mondee Holdings. However, Hanover Foods is 3.58 times less risky than Mondee Holdings. It trades about 0.05 of its potential returns per unit of risk. Mondee Holdings is currently generating about -0.06 per unit of risk. If you would invest 4,972 in Hanover Foods on September 2, 2024 and sell it today you would earn a total of 1,328 from holding Hanover Foods or generate 26.71% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 80.24% |
| Values | Daily Returns |
Hanover Foods vs. Mondee Holdings
Performance |
| Timeline |
| Hanover Foods |
| Mondee Holdings |
Hanover Foods and Mondee Holdings Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Hanover Foods and Mondee Holdings
The main advantage of trading using opposite Hanover Foods and Mondee Holdings positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Hanover Foods position performs unexpectedly, Mondee Holdings 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 Mondee Holdings will offset losses from the drop in Mondee Holdings' long position.| Hanover Foods vs. Signet International Holdings | Hanover Foods vs. National Beverage Corp | Hanover Foods vs. PT Astra International | Hanover Foods vs. Vita Coco |
| Mondee Holdings vs. Yatra Online | Mondee Holdings vs. Despegar Corp | Mondee Holdings vs. Lindblad Expeditions Holdings | Mondee Holdings vs. MakeMyTrip Limited |
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 Balance Of Power module to check stock momentum by analyzing Balance Of Power indicator and other technical ratios.
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