Correlation Between Hudson Global and Automatic Data
Can any of the company-specific risk be diversified away by investing in both Hudson Global and Automatic Data 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 Hudson Global and Automatic Data into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Hudson Global and Automatic Data Processing, you can compare the effects of market volatilities on Hudson Global and Automatic Data 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 Hudson Global with a short position of Automatic Data. Check out your portfolio center. Please also check ongoing floating volatility patterns of Hudson Global and Automatic Data.
Diversification Opportunities for Hudson Global and Automatic Data
-0.26 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Hudson and Automatic is -0.26. Overlapping area represents the amount of risk that can be diversified away by holding Hudson Global and Automatic Data Processing in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Automatic Data Processing and Hudson Global 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 Hudson Global are associated (or correlated) with Automatic Data. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Automatic Data Processing has no effect on the direction of Hudson Global i.e., Hudson Global and Automatic Data go up and down completely randomly.
Pair Corralation between Hudson Global and Automatic Data
Given the investment horizon of 90 days Hudson Global is expected to generate 47.02 times more return on investment than Automatic Data. However, Hudson Global is 47.02 times more volatile than Automatic Data Processing. It trades about 0.05 of its potential returns per unit of risk. Automatic Data Processing is currently generating about 0.1 per unit of risk. If you would invest 2,235 in Hudson Global on August 31, 2024 and sell it today you would lose (757.00) from holding Hudson Global or give up 33.87% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 97.86% |
| Values | Daily Returns |
Hudson Global vs. Automatic Data Processing
Performance |
| Timeline |
| Hudson Global |
| Automatic Data Processing |
Hudson Global and Automatic Data Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Hudson Global and Automatic Data
The main advantage of trading using opposite Hudson Global and Automatic Data positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Hudson Global position performs unexpectedly, Automatic Data 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 Automatic Data will offset losses from the drop in Automatic Data's long position.| Hudson Global vs. Mastech Holdings | Hudson Global vs. Kforce Inc | Hudson Global vs. Kelly Services A | Hudson Global vs. Korn Ferry |
| Automatic Data vs. Robert Half International | Automatic Data vs. Barrett Business Services | Automatic Data vs. ManpowerGroup | Automatic Data vs. Kforce Inc |
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 Pattern Recognition module to use different Pattern Recognition models to time the market across multiple global exchanges.
Other Complementary Tools
| Theme Ratings Determine theme ratings based on digital equity recommendations. Macroaxis theme ratings are based on combination of fundamental analysis and risk-adjusted market performance | |
| Portfolio Optimization Compute new portfolio that will generate highest expected return given your specified tolerance for risk | |
| Portfolio Backtesting Avoid under-diversification and over-optimization by backtesting your portfolios | |
| Odds Of Bankruptcy Get analysis of equity chance of financial distress in the next 2 years | |
| Portfolio Volatility Check portfolio volatility and analyze historical return density to properly model market risk |