Correlation Between Intel and HKT Trust
Can any of the company-specific risk be diversified away by investing in both Intel and HKT Trust 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 Intel and HKT Trust into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Intel and HKT Trust and, you can compare the effects of market volatilities on Intel and HKT Trust 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 Intel with a short position of HKT Trust. Check out your portfolio center. Please also check ongoing floating volatility patterns of Intel and HKT Trust.
Diversification Opportunities for Intel and HKT Trust
Poor diversification
The 3 months correlation between Intel and HKT is 0.76. Overlapping area represents the amount of risk that can be diversified away by holding Intel and HKT Trust and in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on HKT Trust and Intel 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 Intel are associated (or correlated) with HKT Trust. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of HKT Trust has no effect on the direction of Intel i.e., Intel and HKT Trust go up and down completely randomly.
Pair Corralation between Intel and HKT Trust
Given the investment horizon of 90 days Intel is expected to generate 12.96 times less return on investment than HKT Trust. But when comparing it to its historical volatility, Intel is 1.73 times less risky than HKT Trust. It trades about 0.0 of its potential returns per unit of risk. HKT Trust and is currently generating about 0.03 of returns per unit of risk over similar time horizon. If you would invest 120.00 in HKT Trust and on August 31, 2024 and sell it today you would earn a total of 7.00 from holding HKT Trust and or generate 5.83% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 63.84% |
| Values | Daily Returns |
Intel vs. HKT Trust and
Performance |
| Timeline |
| Intel |
| HKT Trust |
Intel and HKT Trust Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Intel and HKT Trust
The main advantage of trading using opposite Intel and HKT Trust positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Intel position performs unexpectedly, HKT Trust 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 HKT Trust will offset losses from the drop in HKT Trust's long position.The idea behind Intel and HKT Trust and pairs trading is to make the combined position market-neutral, meaning the overall market's direction will not affect its win or loss (or potential downside or upside). This can be achieved by designing a pairs trade with two highly correlated stocks or equities that operate in a similar space or sector, making it possible to obtain profits through simple and relatively low-risk investment.| HKT Trust vs. ATT Inc | HKT Trust vs. Verizon Communications | HKT Trust vs. Vodafone Group PLC | HKT Trust vs. T Mobile |
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 File Import module to quickly import all of your third-party portfolios from your local drive in csv format.
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