Correlation Between Ing Intermediate and Hennessy
Can any of the company-specific risk be diversified away by investing in both Ing Intermediate and Hennessy 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 Ing Intermediate and Hennessy into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Ing Intermediate Bond and Hennessy Bp Energy, you can compare the effects of market volatilities on Ing Intermediate and Hennessy 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 Ing Intermediate with a short position of Hennessy. Check out your portfolio center. Please also check ongoing floating volatility patterns of Ing Intermediate and Hennessy.
Diversification Opportunities for Ing Intermediate and Hennessy
-0.61 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between Ing and Hennessy is -0.61. Overlapping area represents the amount of risk that can be diversified away by holding Ing Intermediate Bond and Hennessy Bp Energy in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Hennessy Bp Energy and Ing Intermediate 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 Ing Intermediate Bond are associated (or correlated) with Hennessy. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Hennessy Bp Energy has no effect on the direction of Ing Intermediate i.e., Ing Intermediate and Hennessy go up and down completely randomly.
Pair Corralation between Ing Intermediate and Hennessy
Assuming the 90 days horizon Ing Intermediate is expected to generate 3.05 times less return on investment than Hennessy. But when comparing it to its historical volatility, Ing Intermediate Bond is 3.5 times less risky than Hennessy. It trades about 0.05 of its potential returns per unit of risk. Hennessy Bp Energy is currently generating about 0.04 of returns per unit of risk over similar time horizon. If you would invest 2,279 in Hennessy Bp Energy on September 3, 2024 and sell it today you would earn a total of 593.00 from holding Hennessy Bp Energy or generate 26.02% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Ing Intermediate Bond vs. Hennessy Bp Energy
Performance |
| Timeline |
| Ing Intermediate Bond |
| Hennessy Bp Energy |
Ing Intermediate and Hennessy Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Ing Intermediate and Hennessy
The main advantage of trading using opposite Ing Intermediate and Hennessy positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Ing Intermediate position performs unexpectedly, Hennessy 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 Hennessy will offset losses from the drop in Hennessy's long position.| Ing Intermediate vs. Hennessy Bp Energy | Ing Intermediate vs. Tortoise Energy Independence | Ing Intermediate vs. Dreyfus Natural Resources | Ing Intermediate vs. Fidelity Advisor Energy |
| Hennessy vs. World Energy Fund | Hennessy vs. Ivy Energy Fund | Hennessy vs. Blackrock All Cap Energy | Hennessy vs. Energy Fund Class |
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 Premium Stories module to follow Macroaxis premium stories from verified contributors across different equity types, categories and coverage scope.
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