Correlation Between Hansen Technologies and Kip McGrath
Can any of the company-specific risk be diversified away by investing in both Hansen Technologies and Kip McGrath 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 Hansen Technologies and Kip McGrath into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Hansen Technologies and Kip McGrath Education, you can compare the effects of market volatilities on Hansen Technologies and Kip McGrath 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 Hansen Technologies with a short position of Kip McGrath. Check out your portfolio center. Please also check ongoing floating volatility patterns of Hansen Technologies and Kip McGrath.
Diversification Opportunities for Hansen Technologies and Kip McGrath
0.19 | Correlation Coefficient |
Average diversification
The 3 months correlation between Hansen and Kip is 0.19. Overlapping area represents the amount of risk that can be diversified away by holding Hansen Technologies and Kip McGrath Education in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Kip McGrath Education and Hansen Technologies 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 Hansen Technologies are associated (or correlated) with Kip McGrath. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Kip McGrath Education has no effect on the direction of Hansen Technologies i.e., Hansen Technologies and Kip McGrath go up and down completely randomly.
Pair Corralation between Hansen Technologies and Kip McGrath
Assuming the 90 days trading horizon Hansen Technologies is expected to under-perform the Kip McGrath. In addition to that, Hansen Technologies is 1.01 times more volatile than Kip McGrath Education. It trades about -0.11 of its total potential returns per unit of risk. Kip McGrath Education is currently generating about -0.1 per unit of volatility. If you would invest 49.00 in Kip McGrath Education on November 27, 2024 and sell it today you would lose (5.00) from holding Kip McGrath Education or give up 10.2% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Hansen Technologies vs. Kip McGrath Education
Performance |
| Timeline |
| Hansen Technologies |
| Kip McGrath Education |
Hansen Technologies and Kip McGrath Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Hansen Technologies and Kip McGrath
The main advantage of trading using opposite Hansen Technologies and Kip McGrath positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Hansen Technologies position performs unexpectedly, Kip McGrath 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 Kip McGrath will offset losses from the drop in Kip McGrath's long position.| Hansen Technologies vs. Catalyst Metals | Hansen Technologies vs. Black Rock Mining | Hansen Technologies vs. Maggie Beer Holdings | Hansen Technologies vs. Sky Metals |
| Kip McGrath vs. Sky Metals | Kip McGrath vs. Sonic Healthcare | Kip McGrath vs. Group 6 Metals | Kip McGrath vs. Vitura Health 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 Technical Analysis module to check basic technical indicators and analysis based on most latest market data.
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