Correlation Between HOYA and Hafnia
Can any of the company-specific risk be diversified away by investing in both HOYA and Hafnia 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 HOYA and Hafnia into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between HOYA Corporation and Hafnia Limited, you can compare the effects of market volatilities on HOYA and Hafnia 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 HOYA with a short position of Hafnia. Check out your portfolio center. Please also check ongoing floating volatility patterns of HOYA and Hafnia.
Diversification Opportunities for HOYA and Hafnia
Excellent diversification
The 3 months correlation between HOYA and Hafnia is -0.52. Overlapping area represents the amount of risk that can be diversified away by holding HOYA Corp. and Hafnia Limited in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Hafnia Limited and HOYA 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 HOYA Corporation are associated (or correlated) with Hafnia. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Hafnia Limited has no effect on the direction of HOYA i.e., HOYA and Hafnia go up and down completely randomly.
Pair Corralation between HOYA and Hafnia
Assuming the 90 days horizon HOYA Corporation is expected to generate 2.89 times more return on investment than Hafnia. However, HOYA is 2.89 times more volatile than Hafnia Limited. It trades about 0.09 of its potential returns per unit of risk. Hafnia Limited is currently generating about 0.03 per unit of risk. If you would invest 2,798 in HOYA Corporation on September 1, 2024 and sell it today you would earn a total of 9,232 from holding HOYA Corporation or generate 329.95% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
HOYA Corp. vs. Hafnia Limited
Performance |
| Timeline |
| HOYA |
| Hafnia Limited |
HOYA and Hafnia Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with HOYA and Hafnia
The main advantage of trading using opposite HOYA and Hafnia positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if HOYA position performs unexpectedly, Hafnia 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 Hafnia will offset losses from the drop in Hafnia's long position.| HOYA vs. ESSILORLUXOTTICA 12ON | HOYA vs. Intuitive Surgical | HOYA vs. EssilorLuxottica Socit anonyme | HOYA vs. Becton Dickinson and |
| Hafnia vs. JAPAN TOBACCO UNSPADR12 | Hafnia vs. Digilife Technologies Limited | Hafnia vs. NISSIN FOODS HLDGS | Hafnia vs. AAC TECHNOLOGHLDGADR |
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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