Correlation Between SIRIUS XM and Hastings Technology
Can any of the company-specific risk be diversified away by investing in both SIRIUS XM and Hastings Technology 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 SIRIUS XM and Hastings Technology into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between SIRIUS XM RADIO and Hastings Technology Metals, you can compare the effects of market volatilities on SIRIUS XM and Hastings Technology 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 SIRIUS XM with a short position of Hastings Technology. Check out your portfolio center. Please also check ongoing floating volatility patterns of SIRIUS XM and Hastings Technology.
Diversification Opportunities for SIRIUS XM and Hastings Technology
-0.33 | Correlation Coefficient |
Very good diversification
The 3 months correlation between SIRIUS and Hastings is -0.33. Overlapping area represents the amount of risk that can be diversified away by holding SIRIUS XM RADIO and Hastings Technology Metals in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Hastings Technology and SIRIUS XM 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 SIRIUS XM RADIO are associated (or correlated) with Hastings Technology. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Hastings Technology has no effect on the direction of SIRIUS XM i.e., SIRIUS XM and Hastings Technology go up and down completely randomly.
Pair Corralation between SIRIUS XM and Hastings Technology
Assuming the 90 days trading horizon SIRIUS XM is expected to generate 11.02 times less return on investment than Hastings Technology. But when comparing it to its historical volatility, SIRIUS XM RADIO is 2.43 times less risky than Hastings Technology. It trades about 0.02 of its potential returns per unit of risk. Hastings Technology Metals is currently generating about 0.09 of returns per unit of risk over similar time horizon. If you would invest 11.00 in Hastings Technology Metals on September 2, 2024 and sell it today you would earn a total of 7.00 from holding Hastings Technology Metals or generate 63.64% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 99.23% |
| Values | Daily Returns |
SIRIUS XM RADIO vs. Hastings Technology Metals
Performance |
| Timeline |
| SIRIUS XM RADIO |
| Hastings Technology |
SIRIUS XM and Hastings Technology Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with SIRIUS XM and Hastings Technology
The main advantage of trading using opposite SIRIUS XM and Hastings Technology positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if SIRIUS XM position performs unexpectedly, Hastings Technology 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 Hastings Technology will offset losses from the drop in Hastings Technology's long position.| SIRIUS XM vs. GEELY AUTOMOBILE | SIRIUS XM vs. Dave Busters Entertainment | SIRIUS XM vs. XLMedia PLC | SIRIUS XM vs. CNVISION MEDIA |
| Hastings Technology vs. BHP Group Limited | Hastings Technology vs. Rio Tinto Group | Hastings Technology vs. Vale SA | Hastings Technology vs. Vale SA |
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 Transaction History module to view history of all your transactions and understand their impact on performance.
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