Correlation Between Hawkins and Binah Capital
Can any of the company-specific risk be diversified away by investing in both Hawkins and Binah Capital 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 Hawkins and Binah Capital into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Hawkins and Binah Capital Group,, you can compare the effects of market volatilities on Hawkins and Binah Capital 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 Hawkins with a short position of Binah Capital. Check out your portfolio center. Please also check ongoing floating volatility patterns of Hawkins and Binah Capital.
Diversification Opportunities for Hawkins and Binah Capital
0.27 | Correlation Coefficient |
Modest diversification
The 3 months correlation between Hawkins and Binah is 0.27. Overlapping area represents the amount of risk that can be diversified away by holding Hawkins and Binah Capital Group, in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Binah Capital Group, and Hawkins 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 Hawkins are associated (or correlated) with Binah Capital. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Binah Capital Group, has no effect on the direction of Hawkins i.e., Hawkins and Binah Capital go up and down completely randomly.
Pair Corralation between Hawkins and Binah Capital
Given the investment horizon of 90 days Hawkins is expected to generate 2.56 times less return on investment than Binah Capital. But when comparing it to its historical volatility, Hawkins is 9.0 times less risky than Binah Capital. It trades about 0.15 of its potential returns per unit of risk. Binah Capital Group, is currently generating about 0.04 of returns per unit of risk over similar time horizon. If you would invest 27.00 in Binah Capital Group, on September 2, 2024 and sell it today you would lose (21.06) from holding Binah Capital Group, or give up 78.0% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 67.46% |
| Values | Daily Returns |
Hawkins vs. Binah Capital Group,
Performance |
| Timeline |
| Hawkins |
| Binah Capital Group, |
Hawkins and Binah Capital Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Hawkins and Binah Capital
The main advantage of trading using opposite Hawkins and Binah Capital positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Hawkins position performs unexpectedly, Binah Capital 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 Binah Capital will offset losses from the drop in Binah Capital's long position.| Hawkins vs. H B Fuller | Hawkins vs. Minerals Technologies | Hawkins vs. Quaker Chemical | Hawkins vs. Oil Dri |
| Binah Capital vs. Nomura Holdings ADR | Binah Capital vs. Supercom | Binah Capital vs. Sabre Corpo | Binah Capital vs. Kite Realty Group |
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 Performance Analysis module to check effects of mean-variance optimization against your current asset allocation.
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