Correlation Between SunHydrogen and Hydrogenetics
Can any of the company-specific risk be diversified away by investing in both SunHydrogen and Hydrogenetics 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 SunHydrogen and Hydrogenetics into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between SunHydrogen and Hydrogenetics, you can compare the effects of market volatilities on SunHydrogen and Hydrogenetics 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 SunHydrogen with a short position of Hydrogenetics. Check out your portfolio center. Please also check ongoing floating volatility patterns of SunHydrogen and Hydrogenetics.
Diversification Opportunities for SunHydrogen and Hydrogenetics
0.4 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between SunHydrogen and Hydrogenetics is 0.4. Overlapping area represents the amount of risk that can be diversified away by holding SunHydrogen and Hydrogenetics in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Hydrogenetics and SunHydrogen 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 SunHydrogen are associated (or correlated) with Hydrogenetics. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Hydrogenetics has no effect on the direction of SunHydrogen i.e., SunHydrogen and Hydrogenetics go up and down completely randomly.
Pair Corralation between SunHydrogen and Hydrogenetics
Given the investment horizon of 90 days SunHydrogen is expected to generate 108.12 times less return on investment than Hydrogenetics. But when comparing it to its historical volatility, SunHydrogen is 30.86 times less risky than Hydrogenetics. It trades about 0.06 of its potential returns per unit of risk. Hydrogenetics is currently generating about 0.22 of returns per unit of risk over similar time horizon. If you would invest 0.03 in Hydrogenetics on August 31, 2024 and sell it today you would lose (0.02) from holding Hydrogenetics or give up 66.67% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 52.38% |
| Values | Daily Returns |
SunHydrogen vs. Hydrogenetics
Performance |
| Timeline |
| SunHydrogen |
| Hydrogenetics |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Very Weak
SunHydrogen and Hydrogenetics Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with SunHydrogen and Hydrogenetics
The main advantage of trading using opposite SunHydrogen and Hydrogenetics positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if SunHydrogen position performs unexpectedly, Hydrogenetics 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 Hydrogenetics will offset losses from the drop in Hydrogenetics' long position.| SunHydrogen vs. Enerkon Solar International | SunHydrogen vs. Ascent Solar Technologies, | SunHydrogen vs. Solar Integrated Roofing | SunHydrogen vs. mPhase Technologies |
| Hydrogenetics vs. Weyco Group | Hydrogenetics vs. Kite Realty Group | Hydrogenetics vs. Stepstone Group | Hydrogenetics vs. Papaya Growth Opportunity |
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 Price Ceiling Movement module to calculate and plot Price Ceiling Movement for different equity instruments.
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