Correlation Between Hexagon Purus and Arcticzymes Technologies
Can any of the company-specific risk be diversified away by investing in both Hexagon Purus and Arcticzymes Technologies 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 Hexagon Purus and Arcticzymes Technologies into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Hexagon Purus As and Arcticzymes Technologies ASA, you can compare the effects of market volatilities on Hexagon Purus and Arcticzymes Technologies 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 Hexagon Purus with a short position of Arcticzymes Technologies. Check out your portfolio center. Please also check ongoing floating volatility patterns of Hexagon Purus and Arcticzymes Technologies.
Diversification Opportunities for Hexagon Purus and Arcticzymes Technologies
0.82 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between Hexagon and Arcticzymes is 0.82. Overlapping area represents the amount of risk that can be diversified away by holding Hexagon Purus As and Arcticzymes Technologies ASA in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Arcticzymes Technologies and Hexagon Purus 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 Hexagon Purus As are associated (or correlated) with Arcticzymes Technologies. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Arcticzymes Technologies has no effect on the direction of Hexagon Purus i.e., Hexagon Purus and Arcticzymes Technologies go up and down completely randomly.
Pair Corralation between Hexagon Purus and Arcticzymes Technologies
Assuming the 90 days trading horizon Hexagon Purus As is expected to generate 1.4 times more return on investment than Arcticzymes Technologies. However, Hexagon Purus is 1.4 times more volatile than Arcticzymes Technologies ASA. It trades about -0.06 of its potential returns per unit of risk. Arcticzymes Technologies ASA is currently generating about -0.09 per unit of risk. If you would invest 2,265 in Hexagon Purus As on September 1, 2024 and sell it today you would lose (1,713) from holding Hexagon Purus As or give up 75.63% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Hexagon Purus As vs. Arcticzymes Technologies ASA
Performance |
| Timeline |
| Hexagon Purus As |
| Arcticzymes Technologies |
Hexagon Purus and Arcticzymes Technologies Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Hexagon Purus and Arcticzymes Technologies
The main advantage of trading using opposite Hexagon Purus and Arcticzymes Technologies positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Hexagon Purus position performs unexpectedly, Arcticzymes Technologies 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 Arcticzymes Technologies will offset losses from the drop in Arcticzymes Technologies' long position.| Hexagon Purus vs. Scana ASA | Hexagon Purus vs. Elkem ASA | Hexagon Purus vs. Integrated Wind Solutions | Hexagon Purus vs. Vow ASA |
| Arcticzymes Technologies vs. Carasent ASA | Arcticzymes Technologies vs. Bergenbio ASA | Arcticzymes Technologies vs. Photocure | Arcticzymes Technologies vs. Kitron ASA |
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 Content Syndication module to quickly integrate customizable finance content to your own investment portal.
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