Correlation Between Ihuman and HNI Corp
Can any of the company-specific risk be diversified away by investing in both Ihuman and HNI Corp 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 Ihuman and HNI Corp into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Ihuman Inc and HNI Corp, you can compare the effects of market volatilities on Ihuman and HNI Corp 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 Ihuman with a short position of HNI Corp. Check out your portfolio center. Please also check ongoing floating volatility patterns of Ihuman and HNI Corp.
Diversification Opportunities for Ihuman and HNI Corp
Average diversification
The 3 months correlation between Ihuman and HNI is 0.13. Overlapping area represents the amount of risk that can be diversified away by holding Ihuman Inc and HNI Corp in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on HNI Corp and Ihuman 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 Ihuman Inc are associated (or correlated) with HNI Corp. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of HNI Corp has no effect on the direction of Ihuman i.e., Ihuman and HNI Corp go up and down completely randomly.
Pair Corralation between Ihuman and HNI Corp
Allowing for the 90-day total investment horizon Ihuman Inc is expected to under-perform the HNI Corp. In addition to that, Ihuman is 1.95 times more volatile than HNI Corp. It trades about -0.04 of its total potential returns per unit of risk. HNI Corp is currently generating about 0.11 per unit of volatility. If you would invest 4,445 in HNI Corp on August 24, 2024 and sell it today you would earn a total of 1,111 from holding HNI Corp or generate 24.99% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Ihuman Inc vs. HNI Corp
Performance |
| Timeline |
| Ihuman Inc |
| HNI Corp |
Ihuman and HNI Corp Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Ihuman and HNI Corp
The main advantage of trading using opposite Ihuman and HNI Corp positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Ihuman position performs unexpectedly, HNI Corp 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 HNI Corp will offset losses from the drop in HNI Corp's long position.| Ihuman vs. Boqii Holding Limited | Ihuman vs. Lixiang Education Holding | Ihuman vs. Huize Holding | Ihuman vs. Kuke Music Holding |
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 Instant Ratings module to determine any equity ratings based on digital recommendations. Macroaxis instant equity ratings are based on combination of fundamental analysis and risk-adjusted market performance.
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