Correlation Between H FARM and Greek Organization

Can any of the company-specific risk be diversified away by investing in both H FARM and Greek Organization 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 H FARM and Greek Organization into the same portfolio, which is an essential part of the fundamental portfolio management process.

By analyzing existing cross correlation between H FARM SPA and Greek Organization of, you can compare the effects of market volatilities on H FARM and Greek Organization 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 H FARM with a short position of Greek Organization. Check out your portfolio center. Please also check ongoing floating volatility patterns of H FARM and Greek Organization.

Diversification Opportunities for H FARM and Greek Organization

-0.39

Correlation Coefficient

H FARM  Greek Organization

Very good diversification

The 3 months correlation between 5JQ and Greek is -0.39. Overlapping area represents the amount of risk that can be diversified away by holding H FARM SPA and Greek Organization of in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Greek Organization and H FARM 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 H FARM SPA are associated (or correlated) with Greek Organization. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Greek Organization has no effect on the direction of H FARM i.e., H FARM and Greek Organization go up and down completely randomly.

Pair Corralation between H FARM and Greek Organization

Assuming the 90 days horizon H FARM SPA is expected to under-perform the Greek Organization. In addition to that, H FARM is 2.13 times more volatile than Greek Organization of. It trades about -0.01 of its total potential returns per unit of risk. Greek Organization of is currently generating about 0.07 per unit of volatility. If you would invest  1,485  in Greek Organization of on September 13, 2024 and sell it today you would earn a total of  115.00  from holding Greek Organization of or generate 7.74% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Against
Strength	Insignificant
Accuracy	100.0%
Values	Daily Returns

H FARM SPA  vs.  Greek Organization of

H FARM SPA

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days H FARM SPA has generated negative risk-adjusted returns adding no value to investors with long positions. Despite nearly stable basic indicators, H FARM is not utilizing all of its potentials. The current stock price disturbance, may contribute to mid-run losses for the stockholders.

Greek Organization

Risk-Adjusted Performance

5 of 100

Modest

Compared to the overall equity markets, risk-adjusted returns on investments in Greek Organization of are ranked lower than 5 (%) of all global equities and portfolios over the last 90 days. Despite nearly fragile basic indicators, Greek Organization may actually be approaching a critical reversion point that can send shares even higher in January 2025.

Pair Trading with H FARM and Greek Organization

The main advantage of trading using opposite H FARM and Greek Organization positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if H FARM position performs unexpectedly, Greek Organization 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 Greek Organization will offset losses from the drop in Greek Organization's long position.

The idea behind H FARM SPA and Greek Organization of 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.

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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 Sectors module to list of equity sectors categorizing publicly traded companies based on their primary business activities.