Correlation Between GE Vernova and Hf Foods

Can any of the company-specific risk be diversified away by investing in both GE Vernova and Hf Foods 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 GE Vernova and Hf Foods into the same portfolio, which is an essential part of the fundamental portfolio management process.

By analyzing existing cross correlation between GE Vernova LLC and Hf Foods Group, you can compare the effects of market volatilities on GE Vernova and Hf Foods 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 GE Vernova with a short position of Hf Foods. Check out your portfolio center. Please also check ongoing floating volatility patterns of GE Vernova and Hf Foods.

Diversification Opportunities for GE Vernova and Hf Foods

-0.18

Correlation Coefficient

GE Vernova  Hf Foods

Good diversification

The 3 months correlation between GEV and HFFG is -0.18. Overlapping area represents the amount of risk that can be diversified away by holding GE Vernova LLC and Hf Foods Group in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Hf Foods Group and GE Vernova 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 GE Vernova LLC are associated (or correlated) with Hf Foods. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Hf Foods Group has no effect on the direction of GE Vernova i.e., GE Vernova and Hf Foods go up and down completely randomly.

Pair Corralation between GE Vernova and Hf Foods

Considering the 90-day investment horizon GE Vernova LLC is expected to generate 1.13 times more return on investment than Hf Foods. However, GE Vernova is 1.13 times more volatile than Hf Foods Group. It trades about -0.19 of its potential returns per unit of risk. Hf Foods Group is currently generating about -0.59 per unit of risk. If you would invest  36,171  in GE Vernova LLC on December 5, 2024 and sell it today you would lose (4,864) from holding GE Vernova LLC or give up 13.45% of portfolio value over 90 days.

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

GE Vernova LLC  vs.  Hf Foods Group

GE Vernova LLC

Risk-Adjusted Performance

Very Weak

Over the last 90 days GE Vernova LLC has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of fairly stable technical and fundamental indicators, GE Vernova is not utilizing all of its potentials. The recent stock price fuss, may contribute to near-short-term losses for the sophisticated investors.

Hf Foods Group

Risk-Adjusted Performance

Very Weak

Over the last 90 days Hf Foods Group has generated negative risk-adjusted returns adding no value to investors with long positions. Despite inconsistent performance in the last few months, the Stock's technical and fundamental indicators remain nearly stable which may send shares a bit higher in April 2025. The current disturbance may also be a sign of long-run up-swing for the company stockholders.

Pair Trading with GE Vernova and Hf Foods

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

The idea behind GE Vernova LLC and Hf Foods Group 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 Stock Tickers module to use high-impact, comprehensive, and customizable stock tickers that can be easily integrated to any websites.