Correlation Between Axactor SE and Hexagon Purus

Can any of the company-specific risk be diversified away by investing in both Axactor SE and Hexagon Purus 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 Axactor SE and Hexagon Purus into the same portfolio, which is an essential part of the fundamental portfolio management process.

By analyzing existing cross correlation between Axactor SE and Hexagon Purus As, you can compare the effects of market volatilities on Axactor SE and Hexagon Purus 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 Axactor SE with a short position of Hexagon Purus. Check out your portfolio center. Please also check ongoing floating volatility patterns of Axactor SE and Hexagon Purus.

Diversification Opportunities for Axactor SE and Hexagon Purus

0.83

Correlation Coefficient

Axactor SE  Hexagon Purus

Very poor diversification

The 3 months correlation between Axactor and Hexagon is 0.83. Overlapping area represents the amount of risk that can be diversified away by holding Axactor SE and Hexagon Purus As in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Hexagon Purus As and Axactor SE 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 Axactor SE are associated (or correlated) with Hexagon Purus. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Hexagon Purus As has no effect on the direction of Axactor SE i.e., Axactor SE and Hexagon Purus go up and down completely randomly.

Pair Corralation between Axactor SE and Hexagon Purus

Assuming the 90 days trading horizon Axactor SE is expected to generate 0.5 times more return on investment than Hexagon Purus. However, Axactor SE is 2.02 times less risky than Hexagon Purus. It trades about -0.16 of its potential returns per unit of risk. Hexagon Purus As is currently generating about -0.16 per unit of risk. If you would invest  450.00  in Axactor SE on September 2, 2024 and sell it today you would lose (105.00) from holding Axactor SE or give up 23.33% of portfolio value over 90 days.

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

Axactor SE  vs.  Hexagon Purus As

Axactor SE

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Axactor SE has generated negative risk-adjusted returns adding no value to investors with long positions. Despite weak performance in the last few months, the Stock's basic indicators remain quite persistent which may send shares a bit higher in January 2025. The latest mess may also be a sign of long-standing up-swing for the company institutional investors.

Hexagon Purus As

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Hexagon Purus As has generated negative risk-adjusted returns adding no value to investors with long positions. Despite unfluctuating performance in the last few months, the Stock's essential indicators remain quite persistent which may send shares a bit higher in January 2025. The latest mess may also be a sign of long-standing up-swing for the company institutional investors.

Pair Trading with Axactor SE and Hexagon Purus

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

The idea behind Axactor SE and Hexagon Purus As 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 Piotroski F Score module to get Piotroski F Score based on the binary analysis strategy of nine different fundamentals.