Correlation Between Procter Gamble and Hesai Group
Can any of the company-specific risk be diversified away by investing in both Procter Gamble and Hesai Group 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 Procter Gamble and Hesai Group into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Procter Gamble and Hesai Group American, you can compare the effects of market volatilities on Procter Gamble and Hesai Group 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 Procter Gamble with a short position of Hesai Group. Check out your portfolio center. Please also check ongoing floating volatility patterns of Procter Gamble and Hesai Group.
Diversification Opportunities for Procter Gamble and Hesai Group
-0.47 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Procter and Hesai is -0.47. Overlapping area represents the amount of risk that can be diversified away by holding Procter Gamble and Hesai Group American in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Hesai Group American and Procter Gamble 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 Procter Gamble are associated (or correlated) with Hesai Group. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Hesai Group American has no effect on the direction of Procter Gamble i.e., Procter Gamble and Hesai Group go up and down completely randomly.
Pair Corralation between Procter Gamble and Hesai Group
Allowing for the 90-day total investment horizon Procter Gamble is expected to generate 0.28 times more return on investment than Hesai Group. However, Procter Gamble is 3.59 times less risky than Hesai Group. It trades about 0.08 of its potential returns per unit of risk. Hesai Group American is currently generating about -0.03 per unit of risk. If you would invest 16,970 in Procter Gamble on August 23, 2024 and sell it today you would earn a total of 305.00 from holding Procter Gamble or generate 1.8% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Procter Gamble vs. Hesai Group American
Performance |
| Timeline |
| Procter Gamble |
| Hesai Group American |
Procter Gamble and Hesai Group Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Procter Gamble and Hesai Group
The main advantage of trading using opposite Procter Gamble and Hesai Group positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Procter Gamble position performs unexpectedly, Hesai Group 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 Hesai Group will offset losses from the drop in Hesai Group's long position.| Procter Gamble vs. Honest Company | Procter Gamble vs. Hims Hers Health | Procter Gamble vs. Kimberly Clark | Procter Gamble vs. Colgate Palmolive |
| Hesai Group vs. Garrett Motion | Hesai Group vs. Magna International | Hesai Group vs. Miller Industries | Hesai Group vs. Modine Manufacturing |
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 Portfolio Anywhere module to track or share privately all of your investments from the convenience of any device.
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