Correlation Between First Asset and Harvest Equal
Can any of the company-specific risk be diversified away by investing in both First Asset and Harvest Equal 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 First Asset and Harvest Equal into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between First Asset Tech and Harvest Equal Weight, you can compare the effects of market volatilities on First Asset and Harvest Equal 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 First Asset with a short position of Harvest Equal. Check out your portfolio center. Please also check ongoing floating volatility patterns of First Asset and Harvest Equal.
Diversification Opportunities for First Asset and Harvest Equal
0.55 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between First and Harvest is 0.55. Overlapping area represents the amount of risk that can be diversified away by holding First Asset Tech and Harvest Equal Weight in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Harvest Equal Weight and First Asset 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 First Asset Tech are associated (or correlated) with Harvest Equal. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Harvest Equal Weight has no effect on the direction of First Asset i.e., First Asset and Harvest Equal go up and down completely randomly.
Pair Corralation between First Asset and Harvest Equal
Assuming the 90 days trading horizon First Asset is expected to generate 2.16 times less return on investment than Harvest Equal. In addition to that, First Asset is 1.73 times more volatile than Harvest Equal Weight. It trades about 0.03 of its total potential returns per unit of risk. Harvest Equal Weight is currently generating about 0.1 per unit of volatility. If you would invest 1,783 in Harvest Equal Weight on August 26, 2024 and sell it today you would earn a total of 27.00 from holding Harvest Equal Weight or generate 1.51% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
First Asset Tech vs. Harvest Equal Weight
Performance |
| Timeline |
| First Asset Tech |
| Harvest Equal Weight |
First Asset and Harvest Equal Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with First Asset and Harvest Equal
The main advantage of trading using opposite First Asset and Harvest Equal positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if First Asset position performs unexpectedly, Harvest Equal 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 Harvest Equal will offset losses from the drop in Harvest Equal's long position.| First Asset vs. First Asset Energy | First Asset vs. CI Gold Giants | First Asset vs. Harvest Healthcare Leaders | First Asset vs. Hamilton Enhanced Multi Sector |
| Harvest Equal vs. Harvest Healthcare Leaders | Harvest Equal vs. CI Gold Giants | Harvest Equal vs. BMO Global High | Harvest Equal vs. First Asset Energy |
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 Sign In To Macroaxis module to sign in to explore Macroaxis' wealth optimization platform and fintech modules.
Other Complementary Tools
| Watchlist Optimization Optimize watchlists to build efficient portfolios or rebalance existing positions based on the mean-variance optimization algorithm | |
| Insider Screener Find insiders across different sectors to evaluate their impact on performance | |
| Fundamental Analysis View fundamental data based on most recent published financial statements | |
| Global Markets Map Get a quick overview of global market snapshot using zoomable world map. Drill down to check world indexes | |
| Portfolio Comparator Compare the composition, asset allocations and performance of any two portfolios in your account |