Correlation Between Winland Holdings and Hennessy Technology
Can any of the company-specific risk be diversified away by investing in both Winland Holdings and Hennessy Technology 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 Winland Holdings and Hennessy Technology into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Winland Holdings and Hennessy Technology Fund, you can compare the effects of market volatilities on Winland Holdings and Hennessy Technology 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 Winland Holdings with a short position of Hennessy Technology. Check out your portfolio center. Please also check ongoing floating volatility patterns of Winland Holdings and Hennessy Technology.
Diversification Opportunities for Winland Holdings and Hennessy Technology
0.62 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Winland and Hennessy is 0.62. Overlapping area represents the amount of risk that can be diversified away by holding Winland Holdings and Hennessy Technology Fund in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Hennessy Technology and Winland Holdings 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 Winland Holdings are associated (or correlated) with Hennessy Technology. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Hennessy Technology has no effect on the direction of Winland Holdings i.e., Winland Holdings and Hennessy Technology go up and down completely randomly.
Pair Corralation between Winland Holdings and Hennessy Technology
If you would invest 2,274 in Hennessy Technology Fund on September 2, 2024 and sell it today you would earn a total of 198.00 from holding Hennessy Technology Fund or generate 8.71% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 1.56% |
| Values | Daily Returns |
Winland Holdings vs. Hennessy Technology Fund
Performance |
| Timeline |
| Winland Holdings |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Very Weak
| Hennessy Technology |
Winland Holdings and Hennessy Technology Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Winland Holdings and Hennessy Technology
The main advantage of trading using opposite Winland Holdings and Hennessy Technology positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Winland Holdings position performs unexpectedly, Hennessy Technology 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 Hennessy Technology will offset losses from the drop in Hennessy Technology's long position.The idea behind Winland Holdings and Hennessy Technology Fund 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.| Hennessy Technology vs. Bbh Intermediate Municipal | Hennessy Technology vs. Touchstone Premium Yield | Hennessy Technology vs. Ambrus Core Bond | Hennessy Technology vs. Thrivent Income Fund |
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 Companies Directory module to evaluate performance of over 100,000 Stocks, Funds, and ETFs against different fundamentals.
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