Correlation Between Snap On and Henderson Investment
Can any of the company-specific risk be diversified away by investing in both Snap On and Henderson Investment 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 Snap On and Henderson Investment into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Snap On and Henderson Investment Ltd, you can compare the effects of market volatilities on Snap On and Henderson Investment 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 Snap On with a short position of Henderson Investment. Check out your portfolio center. Please also check ongoing floating volatility patterns of Snap On and Henderson Investment.
Diversification Opportunities for Snap On and Henderson Investment
0.0 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between Snap and Henderson is 0.0. Overlapping area represents the amount of risk that can be diversified away by holding Snap On and Henderson Investment Ltd in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Henderson Investment and Snap On 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 Snap On are associated (or correlated) with Henderson Investment. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Henderson Investment has no effect on the direction of Snap On i.e., Snap On and Henderson Investment go up and down completely randomly.
Pair Corralation between Snap On and Henderson Investment
If you would invest 32,906 in Snap On on September 4, 2024 and sell it today you would earn a total of 3,782 from holding Snap On or generate 11.49% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Flat |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Snap On vs. Henderson Investment Ltd
Performance |
| Timeline |
| Snap On |
| Henderson Investment |
Snap On and Henderson Investment Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Snap On and Henderson Investment
The main advantage of trading using opposite Snap On and Henderson Investment positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Snap On position performs unexpectedly, Henderson Investment 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 Henderson Investment will offset losses from the drop in Henderson Investment's long position.| Snap On vs. Lincoln Electric Holdings | Snap On vs. Timken Company | Snap On vs. Kennametal | Snap On vs. Toro Co |
| Henderson Investment vs. Snap On | Henderson Investment vs. Acme United | Henderson Investment vs. Empresa Distribuidora y | Henderson Investment vs. Procter Gamble |
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 Money Flow Index module to determine momentum by analyzing Money Flow Index and other technical indicators.
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