Correlation Between Hennessy Technology and Siit Us
Can any of the company-specific risk be diversified away by investing in both Hennessy Technology and Siit Us 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 Hennessy Technology and Siit Us into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Hennessy Technology Fund and Siit Equity Factor, you can compare the effects of market volatilities on Hennessy Technology and Siit Us 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 Hennessy Technology with a short position of Siit Us. Check out your portfolio center. Please also check ongoing floating volatility patterns of Hennessy Technology and Siit Us.
Diversification Opportunities for Hennessy Technology and Siit Us
0.71 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Hennessy and Siit is 0.71. Overlapping area represents the amount of risk that can be diversified away by holding Hennessy Technology Fund and Siit Equity Factor in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Siit Equity Factor and Hennessy Technology 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 Hennessy Technology Fund are associated (or correlated) with Siit Us. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Siit Equity Factor has no effect on the direction of Hennessy Technology i.e., Hennessy Technology and Siit Us go up and down completely randomly.
Pair Corralation between Hennessy Technology and Siit Us
Assuming the 90 days horizon Hennessy Technology is expected to generate 1.09 times less return on investment than Siit Us. In addition to that, Hennessy Technology is 1.74 times more volatile than Siit Equity Factor. It trades about 0.13 of its total potential returns per unit of risk. Siit Equity Factor is currently generating about 0.25 per unit of volatility. If you would invest 1,449 in Siit Equity Factor on October 30, 2024 and sell it today you would earn a total of 45.00 from holding Siit Equity Factor or generate 3.11% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Hennessy Technology Fund vs. Siit Equity Factor
Performance |
| Timeline |
| Hennessy Technology |
| Siit Equity Factor |
Hennessy Technology and Siit Us Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Hennessy Technology and Siit Us
The main advantage of trading using opposite Hennessy Technology and Siit Us positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Hennessy Technology position performs unexpectedly, Siit Us 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 Siit Us will offset losses from the drop in Siit Us' long position.| Hennessy Technology vs. Black Oak Emerging | Hennessy Technology vs. Hennessy Large Cap | Hennessy Technology vs. Hennessy Japan Fund | Hennessy Technology vs. Hennessy Small Cap |
| Siit Us vs. Gmo Global Equity | Siit Us vs. Locorr Dynamic Equity | Siit Us vs. Enhanced Fixed Income | Siit Us vs. Gmo Global Equity |
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 Bonds Directory module to find actively traded corporate debentures issued by US companies.
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