Correlation Between Ingevity Corp and Hawkins
Can any of the company-specific risk be diversified away by investing in both Ingevity Corp and Hawkins 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 Ingevity Corp and Hawkins into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Ingevity Corp and Hawkins, you can compare the effects of market volatilities on Ingevity Corp and Hawkins 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 Ingevity Corp with a short position of Hawkins. Check out your portfolio center. Please also check ongoing floating volatility patterns of Ingevity Corp and Hawkins.
Diversification Opportunities for Ingevity Corp and Hawkins
0.0 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between Ingevity and Hawkins is 0.0. Overlapping area represents the amount of risk that can be diversified away by holding Ingevity Corp and Hawkins in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Hawkins and Ingevity Corp 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 Ingevity Corp are associated (or correlated) with Hawkins. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Hawkins has no effect on the direction of Ingevity Corp i.e., Ingevity Corp and Hawkins go up and down completely randomly.
Pair Corralation between Ingevity Corp and Hawkins
Given the investment horizon of 90 days Ingevity Corp is expected to under-perform the Hawkins. In addition to that, Ingevity Corp is 1.24 times more volatile than Hawkins. It trades about -0.01 of its total potential returns per unit of risk. Hawkins is currently generating about 0.12 per unit of volatility. If you would invest 4,004 in Hawkins on August 28, 2024 and sell it today you would earn a total of 9,543 from holding Hawkins or generate 238.34% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Flat |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Ingevity Corp vs. Hawkins
Performance |
| Timeline |
| Ingevity Corp |
| Hawkins |
Ingevity Corp and Hawkins Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Ingevity Corp and Hawkins
The main advantage of trading using opposite Ingevity Corp and Hawkins positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Ingevity Corp position performs unexpectedly, Hawkins 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 Hawkins will offset losses from the drop in Hawkins' long position.| Ingevity Corp vs. Oil Dri | Ingevity Corp vs. H B Fuller | Ingevity Corp vs. Northern Technologies | Ingevity Corp vs. Cabot |
| Hawkins vs. H B Fuller | Hawkins vs. Minerals Technologies | Hawkins vs. Quaker Chemical | Hawkins vs. Oil Dri |
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 Global Markets Map module to get a quick overview of global market snapshot using zoomable world map. Drill down to check world indexes.
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