Correlation Between Halo Collective and Australis Capital

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

By analyzing existing cross correlation between Halo Collective and Australis Capital, you can compare the effects of market volatilities on Halo Collective and Australis Capital 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 Halo Collective with a short position of Australis Capital. Check out your portfolio center. Please also check ongoing floating volatility patterns of Halo Collective and Australis Capital.

Diversification Opportunities for Halo Collective and Australis Capital

0.0

Correlation Coefficient

Halo Collective  Australis Capital

Pay attention - limited upside

The 3 months correlation between Halo and Australis is 0.0. Overlapping area represents the amount of risk that can be diversified away by holding Halo Collective and Australis Capital in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Australis Capital and Halo Collective 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 Halo Collective are associated (or correlated) with Australis Capital. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Australis Capital has no effect on the direction of Halo Collective i.e., Halo Collective and Australis Capital go up and down completely randomly.

Pair Corralation between Halo Collective and Australis Capital

If you would invest  0.01  in Australis Capital on September 29, 2024 and sell it today you would earn a total of  0.00  from holding Australis Capital or generate 0.0% return on investment over 90 days.

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

Halo Collective  vs.  Australis Capital

Halo Collective

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Halo Collective has generated negative risk-adjusted returns adding no value to investors with long positions. Despite nearly stable basic indicators, Halo Collective is not utilizing all of its potentials. The recent stock price disturbance, may contribute to mid-run losses for the stockholders.

Australis Capital

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Australis Capital 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 basic indicators remain nearly stable which may send shares a bit higher in January 2025. The current disturbance may also be a sign of long-run up-swing for the company stockholders.

Pair Trading with Halo Collective and Australis Capital

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

The idea behind Halo Collective and Australis Capital 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.

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 Performance Analysis module to check effects of mean-variance optimization against your current asset allocation.