Correlation Between IHS Holding and SNRE
Can any of the company-specific risk be diversified away by investing in both IHS Holding and SNRE 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 IHS Holding and SNRE into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between IHS Holding and SNRE, you can compare the effects of market volatilities on IHS Holding and SNRE 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 IHS Holding with a short position of SNRE. Check out your portfolio center. Please also check ongoing floating volatility patterns of IHS Holding and SNRE.
Diversification Opportunities for IHS Holding and SNRE
0.28 | Correlation Coefficient |
Modest diversification
The 3 months correlation between IHS and SNRE is 0.28. Overlapping area represents the amount of risk that can be diversified away by holding IHS Holding and SNRE in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on SNRE and IHS Holding 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 IHS Holding are associated (or correlated) with SNRE. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of SNRE has no effect on the direction of IHS Holding i.e., IHS Holding and SNRE go up and down completely randomly.
Pair Corralation between IHS Holding and SNRE
Considering the 90-day investment horizon IHS Holding is expected to generate 4.48 times less return on investment than SNRE. But when comparing it to its historical volatility, IHS Holding is 1.1 times less risky than SNRE. It trades about 0.05 of its potential returns per unit of risk. SNRE is currently generating about 0.19 of returns per unit of risk over similar time horizon. If you would invest 4,235 in SNRE on September 1, 2024 and sell it today you would earn a total of 616.00 from holding SNRE or generate 14.55% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 9.13% |
| Values | Daily Returns |
IHS Holding vs. SNRE
Performance |
| Timeline |
| IHS Holding |
| SNRE |
IHS Holding and SNRE Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with IHS Holding and SNRE
The main advantage of trading using opposite IHS Holding and SNRE positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if IHS Holding position performs unexpectedly, SNRE 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 SNRE will offset losses from the drop in SNRE's long position.| IHS Holding vs. Cogent Communications Group | IHS Holding vs. IDT Corporation | IHS Holding vs. Iridium Communications | IHS Holding vs. Cable One |
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 Competition Analyzer module to analyze and compare many basic indicators for a group of related or unrelated entities.
Other Complementary Tools
| Portfolio Suggestion Get suggestions outside of your existing asset allocation including your own model portfolios | |
| Stocks Directory Find actively traded stocks across global markets | |
| AI Portfolio Architect Use AI to generate optimal portfolios and find profitable investment opportunities | |
| Equity Analysis Research over 250,000 global equities including funds, stocks and ETFs to find investment opportunities | |
| Financial Widgets Easily integrated Macroaxis content with over 30 different plug-and-play financial widgets |