Correlation Between Hawesko Holding and National Bank

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

By analyzing existing cross correlation between Hawesko Holding AG and National Bank Holdings, you can compare the effects of market volatilities on Hawesko Holding and National Bank 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 Hawesko Holding with a short position of National Bank. Check out your portfolio center. Please also check ongoing floating volatility patterns of Hawesko Holding and National Bank.

Diversification Opportunities for Hawesko Holding and National Bank

0.31

Correlation Coefficient

Hawesko Holding  National Bank

Weak diversification

The 3 months correlation between Hawesko and National is 0.31. Overlapping area represents the amount of risk that can be diversified away by holding Hawesko Holding AG and National Bank Holdings in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on National Bank Holdings and Hawesko Holding 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 Hawesko Holding AG are associated (or correlated) with National Bank. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of National Bank Holdings has no effect on the direction of Hawesko Holding i.e., Hawesko Holding and National Bank go up and down completely randomly.

Pair Corralation between Hawesko Holding and National Bank

Assuming the 90 days trading horizon Hawesko Holding AG is expected to generate 0.94 times more return on investment than National Bank. However, Hawesko Holding AG is 1.06 times less risky than National Bank. It trades about -0.03 of its potential returns per unit of risk. National Bank Holdings is currently generating about -0.13 per unit of risk. If you would invest  2,550  in Hawesko Holding AG on December 25, 2024 and sell it today you would lose (80.00) from holding Hawesko Holding AG or give up 3.14% of portfolio value over 90 days.

Time Period	3 Months [change]
Direction	Moves Together
Strength	Very Weak
Accuracy	98.36%
Values	Daily Returns

Hawesko Holding AG  vs.  National Bank Holdings

Hawesko Holding AG

Risk-Adjusted Performance

Very Weak

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

National Bank Holdings

Risk-Adjusted Performance

Very Weak

Over the last 90 days National Bank Holdings has generated negative risk-adjusted returns adding no value to investors with long positions. Despite fragile performance in the last few months, the Stock's basic 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 Hawesko Holding and National Bank

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

The idea behind Hawesko Holding AG and National Bank Holdings 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 Fundamental Analysis module to view fundamental data based on most recent published financial statements.