Correlation Between Textron and HSBC Holdings
Can any of the company-specific risk be diversified away by investing in both Textron and HSBC Holdings 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 Textron and HSBC Holdings into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Textron and HSBC Holdings plc, you can compare the effects of market volatilities on Textron and HSBC Holdings 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 Textron with a short position of HSBC Holdings. Check out your portfolio center. Please also check ongoing floating volatility patterns of Textron and HSBC Holdings.
Diversification Opportunities for Textron and HSBC Holdings
-0.12 | Correlation Coefficient |
Good diversification
The 3 months correlation between Textron and HSBC is -0.12. Overlapping area represents the amount of risk that can be diversified away by holding Textron and HSBC Holdings plc in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on HSBC Holdings plc and Textron 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 Textron are associated (or correlated) with HSBC Holdings. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of HSBC Holdings plc has no effect on the direction of Textron i.e., Textron and HSBC Holdings go up and down completely randomly.
Pair Corralation between Textron and HSBC Holdings
If you would invest 93,500 in HSBC Holdings plc on October 20, 2024 and sell it today you would earn a total of 0.00 from holding HSBC Holdings plc or generate 0.0% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 95.24% |
| Values | Daily Returns |
Textron vs. HSBC Holdings plc
Performance |
| Timeline |
| Textron |
| HSBC Holdings plc |
Textron and HSBC Holdings Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Textron and HSBC Holdings
The main advantage of trading using opposite Textron and HSBC Holdings positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Textron position performs unexpectedly, HSBC Holdings 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 HSBC Holdings will offset losses from the drop in HSBC Holdings' long position.| Textron vs. McEwen Mining | Textron vs. Grupo Carso SAB | Textron vs. Verizon Communications | Textron vs. Samsung Electronics Co |
| HSBC Holdings vs. Prudential Financial | HSBC Holdings vs. Ameriprise Financial | HSBC Holdings vs. Grupo Sports World | HSBC Holdings vs. Martin Marietta Materials |
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 Stock Tickers module to use high-impact, comprehensive, and customizable stock tickers that can be easily integrated to any websites.
Other Complementary Tools
| Headlines Timeline Stay connected to all market stories and filter out noise. Drill down to analyze hype elasticity | |
| FinTech Suite Use AI to screen and filter profitable investment opportunities | |
| Equity Forecasting Use basic forecasting models to generate price predictions and determine price momentum | |
| Financial Widgets Easily integrated Macroaxis content with over 30 different plug-and-play financial widgets | |
| Earnings Calls Check upcoming earnings announcements updated hourly across public exchanges |