Correlation Between HP and USCF Gold
Can any of the company-specific risk be diversified away by investing in both HP and USCF Gold 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 HP and USCF Gold into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between HP Inc and USCF Gold Strategy, you can compare the effects of market volatilities on HP and USCF Gold 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 HP with a short position of USCF Gold. Check out your portfolio center. Please also check ongoing floating volatility patterns of HP and USCF Gold.
Diversification Opportunities for HP and USCF Gold
Poor diversification
The 3 months correlation between HP and USCF is 0.71. Overlapping area represents the amount of risk that can be diversified away by holding HP Inc and USCF Gold Strategy in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on USCF Gold Strategy and HP 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 HP Inc are associated (or correlated) with USCF Gold. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of USCF Gold Strategy has no effect on the direction of HP i.e., HP and USCF Gold go up and down completely randomly.
Pair Corralation between HP and USCF Gold
If you would invest 3,742 in HP Inc on August 27, 2024 and sell it today you would earn a total of 71.00 from holding HP Inc or generate 1.9% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 4.76% |
| Values | Daily Returns |
HP Inc vs. USCF Gold Strategy
Performance |
| Timeline |
| HP Inc |
| USCF Gold Strategy |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
OK
HP and USCF Gold Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with HP and USCF Gold
The main advantage of trading using opposite HP and USCF Gold positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if HP position performs unexpectedly, USCF Gold 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 USCF Gold will offset losses from the drop in USCF Gold's long position.The idea behind HP Inc and USCF Gold Strategy pairs trading is to make the combined position market-neutral, meaning the overall market's direction will not affect its win or loss (or potential downside or upside). This can be achieved by designing a pairs trade with two highly correlated stocks or equities that operate in a similar space or sector, making it possible to obtain profits through simple and relatively low-risk investment.| USCF Gold vs. iShares MSCI Global | USCF Gold vs. Global X Silver | USCF Gold vs. VanEck Junior Gold | USCF Gold vs. Sprott Gold Miners |
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 Portfolio Volatility module to check portfolio volatility and analyze historical return density to properly model market risk.
Other Complementary Tools
| Commodity Directory Find actively traded commodities issued by global exchanges | |
| Transaction History View history of all your transactions and understand their impact on performance | |
| Cryptocurrency Center Build and monitor diversified portfolio of extremely risky digital assets and cryptocurrency | |
| Global Markets Map Get a quick overview of global market snapshot using zoomable world map. Drill down to check world indexes | |
| Premium Stories Follow Macroaxis premium stories from verified contributors across different equity types, categories and coverage scope |