Correlation Between HomeToGo and HEMISPHERE EGY
Can any of the company-specific risk be diversified away by investing in both HomeToGo and HEMISPHERE EGY 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 HomeToGo and HEMISPHERE EGY into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between HomeToGo SE and HEMISPHERE EGY, you can compare the effects of market volatilities on HomeToGo and HEMISPHERE EGY 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 HomeToGo with a short position of HEMISPHERE EGY. Check out your portfolio center. Please also check ongoing floating volatility patterns of HomeToGo and HEMISPHERE EGY.
Diversification Opportunities for HomeToGo and HEMISPHERE EGY
0.41 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between HomeToGo and HEMISPHERE is 0.41. Overlapping area represents the amount of risk that can be diversified away by holding HomeToGo SE and HEMISPHERE EGY in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on HEMISPHERE EGY and HomeToGo 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 HomeToGo SE are associated (or correlated) with HEMISPHERE EGY. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of HEMISPHERE EGY has no effect on the direction of HomeToGo i.e., HomeToGo and HEMISPHERE EGY go up and down completely randomly.
Pair Corralation between HomeToGo and HEMISPHERE EGY
Assuming the 90 days trading horizon HomeToGo SE is expected to under-perform the HEMISPHERE EGY. In addition to that, HomeToGo is 1.4 times more volatile than HEMISPHERE EGY. It trades about -0.1 of its total potential returns per unit of risk. HEMISPHERE EGY is currently generating about -0.01 per unit of volatility. If you would invest 124.00 in HEMISPHERE EGY on August 30, 2024 and sell it today you would lose (1.00) from holding HEMISPHERE EGY or give up 0.81% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
HomeToGo SE vs. HEMISPHERE EGY
Performance |
| Timeline |
| HomeToGo SE |
| HEMISPHERE EGY |
HomeToGo and HEMISPHERE EGY Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with HomeToGo and HEMISPHERE EGY
The main advantage of trading using opposite HomeToGo and HEMISPHERE EGY positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if HomeToGo position performs unexpectedly, HEMISPHERE EGY 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 HEMISPHERE EGY will offset losses from the drop in HEMISPHERE EGY's long position.| HomeToGo vs. Alphabet Class A | HomeToGo vs. Alphabet Class A | HomeToGo vs. Alphabet | HomeToGo vs. Meta Platforms |
| HEMISPHERE EGY vs. Apple Inc | HEMISPHERE EGY vs. Apple Inc | HEMISPHERE EGY vs. Superior Plus Corp | HEMISPHERE EGY vs. SIVERS SEMICONDUCTORS AB |
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 Alpha Finder module to use alpha and beta coefficients to find investment opportunities after accounting for the risk.
Other Complementary Tools
| Price Exposure Probability Analyze equity upside and downside potential for a given time horizon across multiple markets | |
| Efficient Frontier Plot and analyze your portfolio and positions against risk-return landscape of the market. | |
| Equity Forecasting Use basic forecasting models to generate price predictions and determine price momentum | |
| Premium Stories Follow Macroaxis premium stories from verified contributors across different equity types, categories and coverage scope | |
| Companies Directory Evaluate performance of over 100,000 Stocks, Funds, and ETFs against different fundamentals |