Correlation Between Neto Malinda and Hamat
Can any of the company-specific risk be diversified away by investing in both Neto Malinda and Hamat 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 Neto Malinda and Hamat into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Neto Malinda and Hamat Group, you can compare the effects of market volatilities on Neto Malinda and Hamat 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 Neto Malinda with a short position of Hamat. Check out your portfolio center. Please also check ongoing floating volatility patterns of Neto Malinda and Hamat.
Diversification Opportunities for Neto Malinda and Hamat
0.95 | Correlation Coefficient |
Almost no diversification
The 3 months correlation between Neto and Hamat is 0.95. Overlapping area represents the amount of risk that can be diversified away by holding Neto Malinda and Hamat Group in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Hamat Group and Neto Malinda 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 Neto Malinda are associated (or correlated) with Hamat. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Hamat Group has no effect on the direction of Neto Malinda i.e., Neto Malinda and Hamat go up and down completely randomly.
Pair Corralation between Neto Malinda and Hamat
Assuming the 90 days trading horizon Neto Malinda is expected to generate 6.59 times less return on investment than Hamat. But when comparing it to its historical volatility, Neto Malinda is 1.3 times less risky than Hamat. It trades about 0.04 of its potential returns per unit of risk. Hamat Group is currently generating about 0.22 of returns per unit of risk over similar time horizon. If you would invest 183,100 in Hamat Group on October 22, 2024 and sell it today you would earn a total of 22,600 from holding Hamat Group or generate 12.34% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Neto Malinda vs. Hamat Group
Performance |
| Timeline |
| Neto Malinda |
| Hamat Group |
Neto Malinda and Hamat Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Neto Malinda and Hamat
The main advantage of trading using opposite Neto Malinda and Hamat positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Neto Malinda position performs unexpectedly, Hamat 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 Hamat will offset losses from the drop in Hamat's long position.| Neto Malinda vs. Shufersal | Neto Malinda vs. Rami Levi | Neto Malinda vs. Strauss Group | Neto Malinda vs. Kerur Holdings |
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 Aroon Oscillator module to analyze current equity momentum using Aroon Oscillator and other momentum ratios.
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