Correlation Between Intersport Polska and HM Inwest
Can any of the company-specific risk be diversified away by investing in both Intersport Polska and HM Inwest 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 Intersport Polska and HM Inwest into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Intersport Polska SA and HM Inwest SA, you can compare the effects of market volatilities on Intersport Polska and HM Inwest 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 Intersport Polska with a short position of HM Inwest. Check out your portfolio center. Please also check ongoing floating volatility patterns of Intersport Polska and HM Inwest.
Diversification Opportunities for Intersport Polska and HM Inwest
-0.04 | Correlation Coefficient |
Good diversification
The 3 months correlation between Intersport and HMI is -0.04. Overlapping area represents the amount of risk that can be diversified away by holding Intersport Polska SA and HM Inwest SA in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on HM Inwest SA and Intersport Polska 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 Intersport Polska SA are associated (or correlated) with HM Inwest. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of HM Inwest SA has no effect on the direction of Intersport Polska i.e., Intersport Polska and HM Inwest go up and down completely randomly.
Pair Corralation between Intersport Polska and HM Inwest
Assuming the 90 days trading horizon Intersport Polska SA is expected to generate 22.25 times more return on investment than HM Inwest. However, Intersport Polska is 22.25 times more volatile than HM Inwest SA. It trades about 0.14 of its potential returns per unit of risk. HM Inwest SA is currently generating about 0.03 per unit of risk. If you would invest 63.00 in Intersport Polska SA on September 1, 2024 and sell it today you would earn a total of 10.00 from holding Intersport Polska SA or generate 15.87% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 95.24% |
| Values | Daily Returns |
Intersport Polska SA vs. HM Inwest SA
Performance |
| Timeline |
| Intersport Polska |
| HM Inwest SA |
Intersport Polska and HM Inwest Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Intersport Polska and HM Inwest
The main advantage of trading using opposite Intersport Polska and HM Inwest positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Intersport Polska position performs unexpectedly, HM Inwest 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 HM Inwest will offset losses from the drop in HM Inwest's long position.| Intersport Polska vs. Asseco Business Solutions | Intersport Polska vs. Detalion Games SA | Intersport Polska vs. Asseco South Eastern | Intersport Polska vs. CFI Holding SA |
| HM Inwest vs. Mercator Medical SA | HM Inwest vs. Gaming Factory SA | HM Inwest vs. Intersport Polska SA | HM Inwest vs. CI Games SA |
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 Transformation module to use Price Transformation models to analyze the depth of different equity instruments across global markets.
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