Correlation Between HF FOODS and ODYSSEY GOLD
Can any of the company-specific risk be diversified away by investing in both HF FOODS and ODYSSEY GOLD 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 HF FOODS and ODYSSEY GOLD into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between HF FOODS GRP and ODYSSEY GOLD LTD, you can compare the effects of market volatilities on HF FOODS and ODYSSEY GOLD 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 HF FOODS with a short position of ODYSSEY GOLD. Check out your portfolio center. Please also check ongoing floating volatility patterns of HF FOODS and ODYSSEY GOLD.
Diversification Opportunities for HF FOODS and ODYSSEY GOLD
-0.62 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between 3GX and ODYSSEY is -0.62. Overlapping area represents the amount of risk that can be diversified away by holding HF FOODS GRP and ODYSSEY GOLD LTD in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on ODYSSEY GOLD LTD and HF FOODS 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 HF FOODS GRP are associated (or correlated) with ODYSSEY GOLD. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of ODYSSEY GOLD LTD has no effect on the direction of HF FOODS i.e., HF FOODS and ODYSSEY GOLD go up and down completely randomly.
Pair Corralation between HF FOODS and ODYSSEY GOLD
Assuming the 90 days horizon HF FOODS GRP is expected to under-perform the ODYSSEY GOLD. But the stock apears to be less risky and, when comparing its historical volatility, HF FOODS GRP is 3.8 times less risky than ODYSSEY GOLD. The stock trades about -0.17 of its potential returns per unit of risk. The ODYSSEY GOLD LTD is currently generating about 0.0 of returns per unit of risk over similar time horizon. If you would invest 0.95 in ODYSSEY GOLD LTD on September 25, 2024 and sell it today you would lose (0.10) from holding ODYSSEY GOLD LTD or give up 10.53% of portfolio value over 90 days.
Time Period | 3 Months [change] |
Direction | Moves Against |
Strength | Weak |
Accuracy | 95.45% |
Values | Daily Returns |
HF FOODS GRP vs. ODYSSEY GOLD LTD
Performance |
Timeline |
HF FOODS GRP |
ODYSSEY GOLD LTD |
HF FOODS and ODYSSEY GOLD Volatility Contrast
Predicted Return Density |
Returns |
Pair Trading with HF FOODS and ODYSSEY GOLD
The main advantage of trading using opposite HF FOODS and ODYSSEY GOLD positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if HF FOODS position performs unexpectedly, ODYSSEY GOLD 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 ODYSSEY GOLD will offset losses from the drop in ODYSSEY GOLD's long position.HF FOODS vs. Sysco | HF FOODS vs. Jernimo Martins SGPS | HF FOODS vs. JERONIMO MARTINS UNADR2 | HF FOODS vs. Performance Food Group |
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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 Manager module to state of the art Portfolio Manager to monitor and improve performance of your invested capital.
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