Correlation Between Hackett and Globant SA

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

By analyzing existing cross correlation between The Hackett Group and Globant SA, you can compare the effects of market volatilities on Hackett and Globant SA 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 Hackett with a short position of Globant SA. Check out your portfolio center. Please also check ongoing floating volatility patterns of Hackett and Globant SA.

Diversification Opportunities for Hackett and Globant SA

0.74

Correlation Coefficient

Hackett  Globant SA

Poor diversification

The 3 months correlation between Hackett and Globant is 0.74. Overlapping area represents the amount of risk that can be diversified away by holding The Hackett Group and Globant SA in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Globant SA and Hackett 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 The Hackett Group are associated (or correlated) with Globant SA. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Globant SA has no effect on the direction of Hackett i.e., Hackett and Globant SA go up and down completely randomly.

Pair Corralation between Hackett and Globant SA

Given the investment horizon of 90 days The Hackett Group is expected to generate 0.27 times more return on investment than Globant SA. However, The Hackett Group is 3.71 times less risky than Globant SA. It trades about -0.1 of its potential returns per unit of risk. Globant SA is currently generating about -0.19 per unit of risk. If you would invest  3,081  in The Hackett Group on December 20, 2024 and sell it today you would lose (209.00) from holding The Hackett Group or give up 6.78% of portfolio value over 90 days.

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

The Hackett Group  vs.  Globant SA

Hackett Group

Risk-Adjusted Performance

Very Weak

Over the last 90 days The Hackett Group has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of latest inconsistent performance, the Stock's forward-looking signals remain stable and the newest uproar on Wall Street may also be a sign of mid-term gains for the firm private investors.

Globant SA

Risk-Adjusted Performance

Very Weak

Over the last 90 days Globant SA has generated negative risk-adjusted returns adding no value to investors with long positions. Despite unfluctuating performance in the last few months, the Stock's basic indicators remain somewhat strong which may send shares a bit higher in April 2025. The current disturbance may also be a sign of long term up-swing for the company investors.

Pair Trading with Hackett and Globant SA

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

The idea behind The Hackett Group and Globant SA 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 Technical Analysis module to check basic technical indicators and analysis based on most latest market data.