Correlation Between Hamilton Energy and Hamilton Enhanced
Can any of the company-specific risk be diversified away by investing in both Hamilton Energy and Hamilton Enhanced 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 Hamilton Energy and Hamilton Enhanced into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Hamilton Energy YIELD and Hamilton Enhanced Covered, you can compare the effects of market volatilities on Hamilton Energy and Hamilton Enhanced 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 Hamilton Energy with a short position of Hamilton Enhanced. Check out your portfolio center. Please also check ongoing floating volatility patterns of Hamilton Energy and Hamilton Enhanced.
Diversification Opportunities for Hamilton Energy and Hamilton Enhanced
0.37 | Correlation Coefficient |
Weak diversification
The 3 months correlation between Hamilton and Hamilton is 0.37. Overlapping area represents the amount of risk that can be diversified away by holding Hamilton Energy YIELD and Hamilton Enhanced Covered in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Hamilton Enhanced Covered and Hamilton Energy 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 Hamilton Energy YIELD are associated (or correlated) with Hamilton Enhanced. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Hamilton Enhanced Covered has no effect on the direction of Hamilton Energy i.e., Hamilton Energy and Hamilton Enhanced go up and down completely randomly.
Pair Corralation between Hamilton Energy and Hamilton Enhanced
Assuming the 90 days trading horizon Hamilton Energy YIELD is expected to generate 1.0 times more return on investment than Hamilton Enhanced. However, Hamilton Energy is 1.0 times more volatile than Hamilton Enhanced Covered. It trades about 0.1 of its potential returns per unit of risk. Hamilton Enhanced Covered is currently generating about -0.07 per unit of risk. If you would invest 1,413 in Hamilton Energy YIELD on December 23, 2024 and sell it today you would earn a total of 100.00 from holding Hamilton Energy YIELD or generate 7.08% return on investment over 90 days.
Time Period | 3 Months [change] |
Direction | Moves Together |
Strength | Very Weak |
Accuracy | 100.0% |
Values | Daily Returns |
Hamilton Energy YIELD vs. Hamilton Enhanced Covered
Performance |
Timeline |
Hamilton Energy YIELD |
Hamilton Enhanced Covered |
Hamilton Energy and Hamilton Enhanced Volatility Contrast
Predicted Return Density |
Returns |
Pair Trading with Hamilton Energy and Hamilton Enhanced
The main advantage of trading using opposite Hamilton Energy and Hamilton Enhanced positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Hamilton Energy position performs unexpectedly, Hamilton Enhanced 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 Hamilton Enhanced will offset losses from the drop in Hamilton Enhanced's long position.Hamilton Energy vs. Hamilton Equity YIELD | Hamilton Energy vs. Hamilton Enhanced Canadian | Hamilton Energy vs. Hamilton Australian Bank | Hamilton Energy vs. Hamilton MidSmall Cap Financials |
Hamilton Enhanced vs. Hamilton Enhanced Multi Sector | Hamilton Enhanced vs. Harvest Diversified Monthly | Hamilton Enhanced vs. Hamilton Canadian Financials | Hamilton Enhanced vs. Global Dividend Growth |
Check out your portfolio center.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 Equity Valuation module to check real value of public entities based on technical and fundamental data.
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