Correlation Between Hexagon Purus and Hexagon Composites
Can any of the company-specific risk be diversified away by investing in both Hexagon Purus and Hexagon Composites 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 Hexagon Composites 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 Hexagon Composites ASA, you can compare the effects of market volatilities on Hexagon Purus and Hexagon Composites 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 Hexagon Composites. Check out your portfolio center. Please also check ongoing floating volatility patterns of Hexagon Purus and Hexagon Composites.
Diversification Opportunities for Hexagon Purus and Hexagon Composites
-0.41 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Hexagon and Hexagon is -0.41. Overlapping area represents the amount of risk that can be diversified away by holding Hexagon Purus As and Hexagon Composites ASA in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Hexagon Composites ASA 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 Hexagon Composites. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Hexagon Composites ASA has no effect on the direction of Hexagon Purus i.e., Hexagon Purus and Hexagon Composites go up and down completely randomly.
Pair Corralation between Hexagon Purus and Hexagon Composites
Assuming the 90 days trading horizon Hexagon Purus As is expected to under-perform the Hexagon Composites. In addition to that, Hexagon Purus is 1.01 times more volatile than Hexagon Composites ASA. It trades about -0.37 of its total potential returns per unit of risk. Hexagon Composites ASA is currently generating about 0.08 per unit of volatility. If you would invest 4,040 in Hexagon Composites ASA on August 29, 2024 and sell it today you would earn a total of 240.00 from holding Hexagon Composites ASA or generate 5.94% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Hexagon Purus As vs. Hexagon Composites ASA
Performance |
| Timeline |
| Hexagon Purus As |
| Hexagon Composites ASA |
Hexagon Purus and Hexagon Composites Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Hexagon Purus and Hexagon Composites
The main advantage of trading using opposite Hexagon Purus and Hexagon Composites positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Hexagon Purus position performs unexpectedly, Hexagon Composites 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 Hexagon Composites will offset losses from the drop in Hexagon Composites' long position.| Hexagon Purus vs. Scana ASA | Hexagon Purus vs. Elkem ASA | Hexagon Purus vs. Integrated Wind Solutions | Hexagon Purus vs. Vow ASA |
| Hexagon Composites vs. Hexagon Purus As | Hexagon Composites vs. Nel ASA | Hexagon Composites vs. Powercell Sweden | Hexagon Composites vs. Tomra Systems 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 Investing Opportunities module to build portfolios using our predefined set of ideas and optimize them against your investing preferences.
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