Correlation Between Snap and Hire Technologies
Can any of the company-specific risk be diversified away by investing in both Snap and Hire Technologies 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 and Hire Technologies into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Snap Inc and Hire Technologies, you can compare the effects of market volatilities on Snap and Hire Technologies 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 with a short position of Hire Technologies. Check out your portfolio center. Please also check ongoing floating volatility patterns of Snap and Hire Technologies.
Diversification Opportunities for Snap and Hire Technologies
0.0 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between Snap and Hire is 0.0. Overlapping area represents the amount of risk that can be diversified away by holding Snap Inc and Hire Technologies in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Hire Technologies and Snap 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 Inc are associated (or correlated) with Hire Technologies. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Hire Technologies has no effect on the direction of Snap i.e., Snap and Hire Technologies go up and down completely randomly.
Pair Corralation between Snap and Hire Technologies
Given the investment horizon of 90 days Snap Inc is expected to generate 0.75 times more return on investment than Hire Technologies. However, Snap Inc is 1.34 times less risky than Hire Technologies. It trades about 0.03 of its potential returns per unit of risk. Hire Technologies is currently generating about -0.04 per unit of risk. If you would invest 1,010 in Snap Inc on August 26, 2024 and sell it today you would earn a total of 132.00 from holding Snap Inc or generate 13.07% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Flat |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Snap Inc vs. Hire Technologies
Performance |
| Timeline |
| Snap Inc |
| Hire Technologies |
Snap and Hire Technologies Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Snap and Hire Technologies
The main advantage of trading using opposite Snap and Hire Technologies positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Snap position performs unexpectedly, Hire Technologies 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 Hire Technologies will offset losses from the drop in Hire Technologies' long position.The idea behind Snap Inc and Hire Technologies pairs trading is to make the combined position market-neutral, meaning the overall market's direction will not affect its win or loss (or potential downside or upside). This can be achieved by designing a pairs trade with two highly correlated stocks or equities that operate in a similar space or sector, making it possible to obtain profits through simple and relatively low-risk investment.| Hire Technologies vs. Futuris Company | Hire Technologies vs. Trucept | Hire Technologies vs. Randstad Holdings NV | Hire Technologies vs. The Caldwell Partners |
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 Rebalancing module to analyze risk-adjusted returns against different time horizons to find asset-allocation targets.
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