Correlation Between Longvie SA and Halliburton
Can any of the company-specific risk be diversified away by investing in both Longvie SA and Halliburton 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 Longvie SA and Halliburton into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Longvie SA and Halliburton Co, you can compare the effects of market volatilities on Longvie SA and Halliburton 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 Longvie SA with a short position of Halliburton. Check out your portfolio center. Please also check ongoing floating volatility patterns of Longvie SA and Halliburton.
Diversification Opportunities for Longvie SA and Halliburton
-0.09 | Correlation Coefficient |
Good diversification
The 3 months correlation between Longvie and Halliburton is -0.09. Overlapping area represents the amount of risk that can be diversified away by holding Longvie SA and Halliburton Co in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Halliburton and Longvie SA 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 Longvie SA are associated (or correlated) with Halliburton. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Halliburton has no effect on the direction of Longvie SA i.e., Longvie SA and Halliburton go up and down completely randomly.
Pair Corralation between Longvie SA and Halliburton
Assuming the 90 days trading horizon Longvie SA is expected to generate 1.19 times more return on investment than Halliburton. However, Longvie SA is 1.19 times more volatile than Halliburton Co. It trades about 0.26 of its potential returns per unit of risk. Halliburton Co is currently generating about 0.18 per unit of risk. If you would invest 3,880 in Longvie SA on September 2, 2024 and sell it today you would earn a total of 705.00 from holding Longvie SA or generate 18.17% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Longvie SA vs. Halliburton Co
Performance |
| Timeline |
| Longvie SA |
| Halliburton |
Longvie SA and Halliburton Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Longvie SA and Halliburton
The main advantage of trading using opposite Longvie SA and Halliburton positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Longvie SA position performs unexpectedly, Halliburton 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 Halliburton will offset losses from the drop in Halliburton's long position.The idea behind Longvie SA and Halliburton Co 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.| Halliburton vs. Edesa Holding SA | Halliburton vs. Longvie SA | Halliburton vs. American Express Co | Halliburton vs. United States Steel |
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 Money Managers module to screen money managers from public funds and ETFs managed around the world.
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