Correlation Between Hexatronic Group and Orrn Energy
Can any of the company-specific risk be diversified away by investing in both Hexatronic Group and Orrn Energy 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 Hexatronic Group and Orrn Energy into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Hexatronic Group AB and Orrn Energy AB, you can compare the effects of market volatilities on Hexatronic Group and Orrn Energy 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 Hexatronic Group with a short position of Orrn Energy. Check out your portfolio center. Please also check ongoing floating volatility patterns of Hexatronic Group and Orrn Energy.
Diversification Opportunities for Hexatronic Group and Orrn Energy
0.93 | Correlation Coefficient |
Almost no diversification
The 3 months correlation between Hexatronic and Orrn is 0.93. Overlapping area represents the amount of risk that can be diversified away by holding Hexatronic Group AB and Orrn Energy AB in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Orrn Energy AB and Hexatronic Group 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 Hexatronic Group AB are associated (or correlated) with Orrn Energy. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Orrn Energy AB has no effect on the direction of Hexatronic Group i.e., Hexatronic Group and Orrn Energy go up and down completely randomly.
Pair Corralation between Hexatronic Group and Orrn Energy
Assuming the 90 days trading horizon Hexatronic Group AB is expected to generate 1.51 times more return on investment than Orrn Energy. However, Hexatronic Group is 1.51 times more volatile than Orrn Energy AB. It trades about 0.07 of its potential returns per unit of risk. Orrn Energy AB is currently generating about 0.0 per unit of risk. If you would invest 1,982 in Hexatronic Group AB on August 29, 2024 and sell it today you would earn a total of 1,703 from holding Hexatronic Group AB or generate 85.92% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Hexatronic Group AB vs. Orrn Energy AB
Performance |
| Timeline |
| Hexatronic Group |
| Orrn Energy AB |
Hexatronic Group and Orrn Energy Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Hexatronic Group and Orrn Energy
The main advantage of trading using opposite Hexatronic Group and Orrn Energy positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Hexatronic Group position performs unexpectedly, Orrn Energy 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 Orrn Energy will offset losses from the drop in Orrn Energy's long position.| Hexatronic Group vs. Samhllsbyggnadsbolaget i Norden | Hexatronic Group vs. Sinch AB | Hexatronic Group vs. Embracer Group AB | Hexatronic Group vs. Evolution AB |
| Orrn Energy vs. Samhllsbyggnadsbolaget i Norden | Orrn Energy vs. Sinch AB | Orrn Energy vs. Hexatronic Group AB | Orrn Energy vs. SSAB 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 Portfolio Dashboard module to portfolio dashboard that provides centralized access to all your investments.
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