Correlation Between Magna International and Hyrican Informationssyst
Can any of the company-specific risk be diversified away by investing in both Magna International and Hyrican Informationssyst 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 Magna International and Hyrican Informationssyst into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Magna International and Hyrican Informationssysteme Aktiengesellschaft, you can compare the effects of market volatilities on Magna International and Hyrican Informationssyst 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 Magna International with a short position of Hyrican Informationssyst. Check out your portfolio center. Please also check ongoing floating volatility patterns of Magna International and Hyrican Informationssyst.
Diversification Opportunities for Magna International and Hyrican Informationssyst
0.7 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Magna and Hyrican is 0.7. Overlapping area represents the amount of risk that can be diversified away by holding Magna International and Hyrican Informationssysteme Ak in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Hyrican Informationssyst and Magna International 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 Magna International are associated (or correlated) with Hyrican Informationssyst. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Hyrican Informationssyst has no effect on the direction of Magna International i.e., Magna International and Hyrican Informationssyst go up and down completely randomly.
Pair Corralation between Magna International and Hyrican Informationssyst
Assuming the 90 days horizon Magna International is expected to under-perform the Hyrican Informationssyst. In addition to that, Magna International is 2.38 times more volatile than Hyrican Informationssysteme Aktiengesellschaft. It trades about -0.28 of its total potential returns per unit of risk. Hyrican Informationssysteme Aktiengesellschaft is currently generating about -0.2 per unit of volatility. If you would invest 530.00 in Hyrican Informationssysteme Aktiengesellschaft on October 9, 2024 and sell it today you would lose (10.00) from holding Hyrican Informationssysteme Aktiengesellschaft or give up 1.89% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Magna International vs. Hyrican Informationssysteme Ak
Performance |
| Timeline |
| Magna International |
| Hyrican Informationssyst |
Magna International and Hyrican Informationssyst Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Magna International and Hyrican Informationssyst
The main advantage of trading using opposite Magna International and Hyrican Informationssyst positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Magna International position performs unexpectedly, Hyrican Informationssyst 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 Hyrican Informationssyst will offset losses from the drop in Hyrican Informationssyst's long position.| Magna International vs. ATRESMEDIA | Magna International vs. Dave Busters Entertainment | Magna International vs. SUN LIFE FINANCIAL | Magna International vs. JSC Halyk bank |
| Hyrican Informationssyst vs. Dalata Hotel Group | Hyrican Informationssyst vs. Meli Hotels International | Hyrican Informationssyst vs. PPHE HOTEL GROUP | Hyrican Informationssyst vs. COVIVIO HOTELS INH |
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 Piotroski F Score module to get Piotroski F Score based on the binary analysis strategy of nine different fundamentals.
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