Correlation Between Hexagon AB and Global Warming
Can any of the company-specific risk be diversified away by investing in both Hexagon AB and Global Warming 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 Hexagon AB and Global Warming into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Hexagon AB ADR and Global Warming Solut, you can compare the effects of market volatilities on Hexagon AB and Global Warming 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 Hexagon AB with a short position of Global Warming. Check out your portfolio center. Please also check ongoing floating volatility patterns of Hexagon AB and Global Warming.
Diversification Opportunities for Hexagon AB and Global Warming
-0.68 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between Hexagon and Global is -0.68. Overlapping area represents the amount of risk that can be diversified away by holding Hexagon AB ADR and Global Warming Solut in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Global Warming Solut and Hexagon AB 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 Hexagon AB ADR are associated (or correlated) with Global Warming. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Global Warming Solut has no effect on the direction of Hexagon AB i.e., Hexagon AB and Global Warming go up and down completely randomly.
Pair Corralation between Hexagon AB and Global Warming
Assuming the 90 days horizon Hexagon AB ADR is expected to generate 0.19 times more return on investment than Global Warming. However, Hexagon AB ADR is 5.25 times less risky than Global Warming. It trades about 0.43 of its potential returns per unit of risk. Global Warming Solut is currently generating about -0.08 per unit of risk. If you would invest 961.00 in Hexagon AB ADR on November 6, 2024 and sell it today you would earn a total of 199.00 from holding Hexagon AB ADR or generate 20.71% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Hexagon AB ADR vs. Global Warming Solut
Performance |
| Timeline |
| Hexagon AB ADR |
| Global Warming Solut |
Hexagon AB and Global Warming Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Hexagon AB and Global Warming
The main advantage of trading using opposite Hexagon AB and Global Warming positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Hexagon AB position performs unexpectedly, Global Warming 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 Global Warming will offset losses from the drop in Global Warming's long position.| Hexagon AB vs. Novanta | Hexagon AB vs. Fortive Corp | Hexagon AB vs. Vishay Precision Group | Hexagon AB vs. Itron Inc |
| Global Warming vs. Darkpulse | Global Warming vs. Blacksky Technology | Global Warming vs. Coherent | Global Warming vs. Sobr Safe |
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 Content Syndication module to quickly integrate customizable finance content to your own investment portal.
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