Correlation Between Hawsons Iron and Gtn

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

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

Diversification Opportunities for Hawsons Iron and Gtn

-0.72

Correlation Coefficient

Hawsons Iron  Gtn

Pay attention - limited upside

The 3 months correlation between Hawsons and Gtn is -0.72. Overlapping area represents the amount of risk that can be diversified away by holding Hawsons Iron and Gtn in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Gtn and Hawsons Iron 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 Hawsons Iron are associated (or correlated) with Gtn. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Gtn has no effect on the direction of Hawsons Iron i.e., Hawsons Iron and Gtn go up and down completely randomly.

Pair Corralation between Hawsons Iron and Gtn

Assuming the 90 days trading horizon Hawsons Iron is expected to under-perform the Gtn. In addition to that, Hawsons Iron is 1.22 times more volatile than Gtn. It trades about -0.03 of its total potential returns per unit of risk. Gtn is currently generating about 0.13 per unit of volatility. If you would invest  47.00  in Gtn on October 6, 2024 and sell it today you would earn a total of  13.00  from holding Gtn or generate 27.66% return on investment over 90 days.

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

Hawsons Iron  vs.  Gtn

Hawsons Iron

Risk-Adjusted Performance

0 of 100

Very Weak

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

Gtn

Risk-Adjusted Performance

10 of 100

OK

Compared to the overall equity markets, risk-adjusted returns on investments in Gtn are ranked lower than 10 (%) of all global equities and portfolios over the last 90 days. In spite of comparatively uncertain basic indicators, Gtn unveiled solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with Hawsons Iron and Gtn

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

The idea behind Hawsons Iron and Gtn 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 Fundamentals Comparison module to compare fundamentals across multiple equities to find investing opportunities.