Correlation Between Ally Leasehold and Halcyon Technology

Can any of the company-specific risk be diversified away by investing in both Ally Leasehold and Halcyon Technology 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 Ally Leasehold and Halcyon Technology into the same portfolio, which is an essential part of the fundamental portfolio management process.

By analyzing existing cross correlation between Ally Leasehold Real and Halcyon Technology Public, you can compare the effects of market volatilities on Ally Leasehold and Halcyon Technology 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 Ally Leasehold with a short position of Halcyon Technology. Check out your portfolio center. Please also check ongoing floating volatility patterns of Ally Leasehold and Halcyon Technology.

Diversification Opportunities for Ally Leasehold and Halcyon Technology

0.34

Correlation Coefficient

Ally Leasehold  Halcyon Technology

Weak diversification

The 3 months correlation between Ally and Halcyon is 0.34. Overlapping area represents the amount of risk that can be diversified away by holding Ally Leasehold Real and Halcyon Technology Public in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Halcyon Technology Public and Ally Leasehold 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 Ally Leasehold Real are associated (or correlated) with Halcyon Technology. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Halcyon Technology Public has no effect on the direction of Ally Leasehold i.e., Ally Leasehold and Halcyon Technology go up and down completely randomly.

Pair Corralation between Ally Leasehold and Halcyon Technology

Assuming the 90 days trading horizon Ally Leasehold Real is expected to under-perform the Halcyon Technology. But the stock apears to be less risky and, when comparing its historical volatility, Ally Leasehold Real is 2.26 times less risky than Halcyon Technology. The stock trades about -0.01 of its potential returns per unit of risk. The Halcyon Technology Public is currently generating about 0.05 of returns per unit of risk over similar time horizon. If you would invest  217.00  in Halcyon Technology Public on December 3, 2024 and sell it today you would earn a total of  97.00  from holding Halcyon Technology Public or generate 44.7% return on investment over 90 days.

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

Ally Leasehold Real  vs.  Halcyon Technology Public

Ally Leasehold Real

Risk-Adjusted Performance

Very Weak

Over the last 90 days Ally Leasehold Real has generated negative risk-adjusted returns adding no value to investors with long positions. Despite quite persistent forward-looking signals, Ally Leasehold is not utilizing all of its potentials. The current stock price mess, may contribute to short-term losses for the institutional investors.

Halcyon Technology Public

Risk-Adjusted Performance

Very Weak

Over the last 90 days Halcyon Technology Public has generated negative risk-adjusted returns adding no value to investors with long positions. Despite conflicting performance in the last few months, the Stock's fundamental drivers remain somewhat strong which may send shares a bit higher in April 2025. The current disturbance may also be a sign of long term up-swing for the company investors.

Pair Trading with Ally Leasehold and Halcyon Technology

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

The idea behind Ally Leasehold Real and Halcyon Technology Public 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 Pattern Recognition module to use different Pattern Recognition models to time the market across multiple global exchanges.