Correlation Between Haemonetics and 00108WAF7

Can any of the company-specific risk be diversified away by investing in both Haemonetics and 00108WAF7 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 Haemonetics and 00108WAF7 into the same portfolio, which is an essential part of the fundamental portfolio management process.

By analyzing existing cross correlation between Haemonetics and AEP TEX INC, you can compare the effects of market volatilities on Haemonetics and 00108WAF7 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 Haemonetics with a short position of 00108WAF7. Check out your portfolio center. Please also check ongoing floating volatility patterns of Haemonetics and 00108WAF7.

Diversification Opportunities for Haemonetics and 00108WAF7

0.06

Correlation Coefficient

Haemonetics  00108WAF7

Significant diversification

The 3 months correlation between Haemonetics and 00108WAF7 is 0.06. Overlapping area represents the amount of risk that can be diversified away by holding Haemonetics and AEP TEX INC in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on AEP TEX INC and Haemonetics 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 Haemonetics are associated (or correlated) with 00108WAF7. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of AEP TEX INC has no effect on the direction of Haemonetics i.e., Haemonetics and 00108WAF7 go up and down completely randomly.

Pair Corralation between Haemonetics and 00108WAF7

Considering the 90-day investment horizon Haemonetics is expected to under-perform the 00108WAF7. In addition to that, Haemonetics is 1.51 times more volatile than AEP TEX INC. It trades about -0.11 of its total potential returns per unit of risk. AEP TEX INC is currently generating about 0.03 per unit of volatility. If you would invest  7,190  in AEP TEX INC on December 27, 2024 and sell it today you would earn a total of  126.00  from holding AEP TEX INC or generate 1.75% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Together
Strength	Insignificant
Accuracy	81.67%
Values	Daily Returns

Haemonetics  vs.  AEP TEX INC

Haemonetics

Risk-Adjusted Performance

Very Weak

Over the last 90 days Haemonetics has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of inconsistent performance in the last few months, the Stock's basic indicators remain rather sound which may send shares a bit higher in April 2025. The latest tumult may also be a sign of longer-term up-swing for the firm shareholders.

AEP TEX INC

Risk-Adjusted Performance

Weak

Compared to the overall equity markets, risk-adjusted returns on investments in AEP TEX INC are ranked lower than 2 (%) of all global equities and portfolios over the last 90 days. Despite somewhat strong basic indicators, 00108WAF7 is not utilizing all of its potentials. The current stock price disturbance, may contribute to short-term losses for the investors.

Pair Trading with Haemonetics and 00108WAF7

The main advantage of trading using opposite Haemonetics and 00108WAF7 positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Haemonetics position performs unexpectedly, 00108WAF7 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 00108WAF7 will offset losses from the drop in 00108WAF7's long position.

The idea behind Haemonetics and AEP TEX INC 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.