Correlation Between Hollywood Bowl and IShares Physical

Can any of the company-specific risk be diversified away by investing in both Hollywood Bowl and IShares Physical 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 Hollywood Bowl and IShares Physical into the same portfolio, which is an essential part of the fundamental portfolio management process.

By analyzing existing cross correlation between Hollywood Bowl Group and iShares Physical Silver, you can compare the effects of market volatilities on Hollywood Bowl and IShares Physical 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 Hollywood Bowl with a short position of IShares Physical. Check out your portfolio center. Please also check ongoing floating volatility patterns of Hollywood Bowl and IShares Physical.

Diversification Opportunities for Hollywood Bowl and IShares Physical

0.6

Correlation Coefficient

Hollywood Bowl  IShares Physical

Poor diversification

The 3 months correlation between Hollywood and IShares is 0.6. Overlapping area represents the amount of risk that can be diversified away by holding Hollywood Bowl Group and iShares Physical Silver in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on iShares Physical Silver and Hollywood Bowl 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 Hollywood Bowl Group are associated (or correlated) with IShares Physical. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of iShares Physical Silver has no effect on the direction of Hollywood Bowl i.e., Hollywood Bowl and IShares Physical go up and down completely randomly.

Pair Corralation between Hollywood Bowl and IShares Physical

Assuming the 90 days trading horizon Hollywood Bowl Group is expected to under-perform the IShares Physical. In addition to that, Hollywood Bowl is 1.16 times more volatile than iShares Physical Silver. It trades about -0.05 of its total potential returns per unit of risk. iShares Physical Silver is currently generating about -0.01 per unit of volatility. If you would invest  2,921  in iShares Physical Silver on October 9, 2024 and sell it today you would lose (44.00) from holding iShares Physical Silver or give up 1.51% of portfolio value over 90 days.

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

Hollywood Bowl Group  vs.  iShares Physical Silver

Hollywood Bowl Group

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Hollywood Bowl Group has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of latest unsteady performance, the Stock's basic indicators remain stable and the newest uproar on Wall Street may also be a sign of mid-term gains for the firm private investors.

iShares Physical Silver

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days iShares Physical Silver has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of comparatively stable basic indicators, IShares Physical is not utilizing all of its potentials. The newest stock price uproar, may contribute to short-horizon losses for the private investors.

Pair Trading with Hollywood Bowl and IShares Physical

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

The idea behind Hollywood Bowl Group and iShares Physical Silver 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 Theme Ratings module to determine theme ratings based on digital equity recommendations. Macroaxis theme ratings are based on combination of fundamental analysis and risk-adjusted market performance.