Correlation Between Akums Drugs and Hilton Metal

Can any of the company-specific risk be diversified away by investing in both Akums Drugs and Hilton Metal 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 Akums Drugs and Hilton Metal into the same portfolio, which is an essential part of the fundamental portfolio management process.

By analyzing existing cross correlation between Akums Drugs and and Hilton Metal Forging, you can compare the effects of market volatilities on Akums Drugs and Hilton Metal 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 Akums Drugs with a short position of Hilton Metal. Check out your portfolio center. Please also check ongoing floating volatility patterns of Akums Drugs and Hilton Metal.

Diversification Opportunities for Akums Drugs and Hilton Metal

-0.47

Correlation Coefficient

Akums Drugs  Hilton Metal

Very good diversification

The 3 months correlation between Akums and Hilton is -0.47. Overlapping area represents the amount of risk that can be diversified away by holding Akums Drugs and and Hilton Metal Forging in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Hilton Metal Forging and Akums Drugs 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 Akums Drugs and are associated (or correlated) with Hilton Metal. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Hilton Metal Forging has no effect on the direction of Akums Drugs i.e., Akums Drugs and Hilton Metal go up and down completely randomly.

Pair Corralation between Akums Drugs and Hilton Metal

Assuming the 90 days trading horizon Akums Drugs and is expected to under-perform the Hilton Metal. In addition to that, Akums Drugs is 1.2 times more volatile than Hilton Metal Forging. It trades about -0.05 of its total potential returns per unit of risk. Hilton Metal Forging is currently generating about 0.0 per unit of volatility. If you would invest  12,365  in Hilton Metal Forging on October 9, 2024 and sell it today you would lose (707.00) from holding Hilton Metal Forging or give up 5.72% of portfolio value over 90 days.

Time Period	3 Months [change]
Direction	Moves Against
Strength	Very Weak
Accuracy	57.61%
Values	Daily Returns

Akums Drugs and  vs.  Hilton Metal Forging

Akums Drugs

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Akums Drugs and has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of weak performance in the last few months, the Stock's basic indicators remain very healthy which may send shares a bit higher in February 2025. The recent disarray may also be a sign of long period up-swing for the firm investors.

Hilton Metal Forging

Risk-Adjusted Performance

13 of 100

Good

Compared to the overall equity markets, risk-adjusted returns on investments in Hilton Metal Forging are ranked lower than 13 (%) of all global equities and portfolios over the last 90 days. Despite somewhat weak basic indicators, Hilton Metal sustained solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with Akums Drugs and Hilton Metal

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

The idea behind Akums Drugs and and Hilton Metal Forging 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 Fundamentals Comparison module to compare fundamentals across multiple equities to find investing opportunities.