Correlation Between HWH International and WK Kellogg
Can any of the company-specific risk be diversified away by investing in both HWH International and WK Kellogg 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 HWH International and WK Kellogg into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between HWH International and WK Kellogg Co, you can compare the effects of market volatilities on HWH International and WK Kellogg 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 HWH International with a short position of WK Kellogg. Check out your portfolio center. Please also check ongoing floating volatility patterns of HWH International and WK Kellogg.
Diversification Opportunities for HWH International and WK Kellogg
0.53 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between HWH and KLG is 0.53. Overlapping area represents the amount of risk that can be diversified away by holding HWH International and WK Kellogg Co in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on WK Kellogg and HWH International 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 HWH International are associated (or correlated) with WK Kellogg. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of WK Kellogg has no effect on the direction of HWH International i.e., HWH International and WK Kellogg go up and down completely randomly.
Pair Corralation between HWH International and WK Kellogg
Considering the 90-day investment horizon HWH International is expected to under-perform the WK Kellogg. In addition to that, HWH International is 6.17 times more volatile than WK Kellogg Co. It trades about -0.03 of its total potential returns per unit of risk. WK Kellogg Co is currently generating about -0.06 per unit of volatility. If you would invest 1,780 in WK Kellogg Co on November 2, 2024 and sell it today you would lose (80.00) from holding WK Kellogg Co or give up 4.49% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
HWH International vs. WK Kellogg Co
Performance |
| Timeline |
| HWH International |
| WK Kellogg |
HWH International and WK Kellogg Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with HWH International and WK Kellogg
The main advantage of trading using opposite HWH International and WK Kellogg positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if HWH International position performs unexpectedly, WK Kellogg 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 WK Kellogg will offset losses from the drop in WK Kellogg's long position.| HWH International vs. NetEase | HWH International vs. Glorywin Entertainment Group | HWH International vs. Cardinal Health | HWH International vs. Viemed Healthcare |
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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 Volatility Analysis module to get historical volatility and risk analysis based on latest market data.
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