Correlation Between Sanyo Chemical and Hoist Finance
Can any of the company-specific risk be diversified away by investing in both Sanyo Chemical and Hoist Finance 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 Sanyo Chemical and Hoist Finance into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Sanyo Chemical Industries and Hoist Finance AB, you can compare the effects of market volatilities on Sanyo Chemical and Hoist Finance 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 Sanyo Chemical with a short position of Hoist Finance. Check out your portfolio center. Please also check ongoing floating volatility patterns of Sanyo Chemical and Hoist Finance.
Diversification Opportunities for Sanyo Chemical and Hoist Finance
0.23 | Correlation Coefficient |
Modest diversification
The 3 months correlation between Sanyo and Hoist is 0.23. Overlapping area represents the amount of risk that can be diversified away by holding Sanyo Chemical Industries and Hoist Finance AB in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Hoist Finance AB and Sanyo Chemical 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 Sanyo Chemical Industries are associated (or correlated) with Hoist Finance. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Hoist Finance AB has no effect on the direction of Sanyo Chemical i.e., Sanyo Chemical and Hoist Finance go up and down completely randomly.
Pair Corralation between Sanyo Chemical and Hoist Finance
Assuming the 90 days horizon Sanyo Chemical Industries is expected to under-perform the Hoist Finance. But the stock apears to be less risky and, when comparing its historical volatility, Sanyo Chemical Industries is 3.1 times less risky than Hoist Finance. The stock trades about -0.04 of its potential returns per unit of risk. The Hoist Finance AB is currently generating about -0.01 of returns per unit of risk over similar time horizon. If you would invest 826.00 in Hoist Finance AB on November 7, 2024 and sell it today you would lose (10.00) from holding Hoist Finance AB or give up 1.21% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Sanyo Chemical Industries vs. Hoist Finance AB
Performance |
| Timeline |
| Sanyo Chemical Industries |
| Hoist Finance AB |
Sanyo Chemical and Hoist Finance Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Sanyo Chemical and Hoist Finance
The main advantage of trading using opposite Sanyo Chemical and Hoist Finance positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Sanyo Chemical position performs unexpectedly, Hoist Finance 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 Hoist Finance will offset losses from the drop in Hoist Finance's long position.| Sanyo Chemical vs. DISTRICT METALS | Sanyo Chemical vs. De Grey Mining | Sanyo Chemical vs. Siamgas And Petrochemicals | Sanyo Chemical vs. Calibre Mining Corp |
| Hoist Finance vs. VIENNA INSURANCE GR | Hoist Finance vs. Scottish Mortgage Investment | Hoist Finance vs. Safety Insurance Group | Hoist Finance vs. Canadian Utilities Limited |
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 Comparator module to compare the composition, asset allocations and performance of any two portfolios in your account.
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