Correlation Between Hexatronic Group and TagMaster
Can any of the company-specific risk be diversified away by investing in both Hexatronic Group and TagMaster 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 TagMaster 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 TagMaster AB Series, you can compare the effects of market volatilities on Hexatronic Group and TagMaster 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 TagMaster. Check out your portfolio center. Please also check ongoing floating volatility patterns of Hexatronic Group and TagMaster.
Diversification Opportunities for Hexatronic Group and TagMaster
0.78 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Hexatronic and TagMaster is 0.78. Overlapping area represents the amount of risk that can be diversified away by holding Hexatronic Group AB and TagMaster AB Series in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on TagMaster AB Series 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 TagMaster. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of TagMaster AB Series has no effect on the direction of Hexatronic Group i.e., Hexatronic Group and TagMaster go up and down completely randomly.
Pair Corralation between Hexatronic Group and TagMaster
Assuming the 90 days trading horizon Hexatronic Group AB is expected to generate 0.66 times more return on investment than TagMaster. However, Hexatronic Group AB is 1.52 times less risky than TagMaster. It trades about 0.05 of its potential returns per unit of risk. TagMaster AB Series is currently generating about -0.02 per unit of risk. If you would invest 3,728 in Hexatronic Group AB on October 7, 2024 and sell it today you would earn a total of 62.00 from holding Hexatronic Group AB or generate 1.66% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Hexatronic Group AB vs. TagMaster AB Series
Performance |
| Timeline |
| Hexatronic Group |
| TagMaster AB Series |
Hexatronic Group and TagMaster Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Hexatronic Group and TagMaster
The main advantage of trading using opposite Hexatronic Group and TagMaster positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Hexatronic Group position performs unexpectedly, TagMaster 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 TagMaster will offset losses from the drop in TagMaster'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 |
| TagMaster vs. Waystream Holding AB | TagMaster vs. Gapwaves AB Series | TagMaster vs. Organoclick AB | TagMaster vs. G5 Entertainment publ |
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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