Correlation Between Super Retail and Hudson Investment
Can any of the company-specific risk be diversified away by investing in both Super Retail and Hudson 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 Super Retail and Hudson Investment into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Super Retail Group and Hudson Investment Group, you can compare the effects of market volatilities on Super Retail and Hudson 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 Super Retail with a short position of Hudson Investment. Check out your portfolio center. Please also check ongoing floating volatility patterns of Super Retail and Hudson Investment.
Diversification Opportunities for Super Retail and Hudson Investment
0.0 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between Super and Hudson is 0.0. Overlapping area represents the amount of risk that can be diversified away by holding Super Retail Group and Hudson Investment Group in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Hudson Investment and Super Retail 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 Super Retail Group are associated (or correlated) with Hudson Investment. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Hudson Investment has no effect on the direction of Super Retail i.e., Super Retail and Hudson Investment go up and down completely randomly.
Pair Corralation between Super Retail and Hudson Investment
Assuming the 90 days trading horizon Super Retail Group is expected to generate 0.95 times more return on investment than Hudson Investment. However, Super Retail Group is 1.06 times less risky than Hudson Investment. It trades about 0.06 of its potential returns per unit of risk. Hudson Investment Group is currently generating about -0.05 per unit of risk. If you would invest 985.00 in Super Retail Group on August 30, 2024 and sell it today you would earn a total of 504.00 from holding Super Retail Group or generate 51.17% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Flat |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Super Retail Group vs. Hudson Investment Group
Performance |
| Timeline |
| Super Retail Group |
| Hudson Investment |
Super Retail and Hudson Investment Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Super Retail and Hudson Investment
The main advantage of trading using opposite Super Retail and Hudson Investment positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Super Retail position performs unexpectedly, Hudson 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 Hudson Investment will offset losses from the drop in Hudson Investment's long position.| Super Retail vs. Readytech Holdings | Super Retail vs. IDP Education | Super Retail vs. Richmond Vanadium Technology | Super Retail vs. Kip McGrath Education |
| Hudson Investment vs. Hawsons Iron | Hudson Investment vs. Retail Food Group | Hudson Investment vs. Richmond Vanadium Technology | Hudson Investment vs. Dexus Convenience Retail |
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 Positions Ratings module to determine portfolio positions ratings based on digital equity recommendations. Macroaxis instant position ratings are based on combination of fundamental analysis and risk-adjusted market performance.
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