Correlation Between Harmonic and Bridger Aerospace

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

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

Diversification Opportunities for Harmonic and Bridger Aerospace

0.48

Correlation Coefficient

Harmonic  Bridger Aerospace

Very weak diversification

The 3 months correlation between Harmonic and Bridger is 0.48. Overlapping area represents the amount of risk that can be diversified away by holding Harmonic and Bridger Aerospace Group in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Bridger Aerospace and Harmonic 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 Harmonic are associated (or correlated) with Bridger Aerospace. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Bridger Aerospace has no effect on the direction of Harmonic i.e., Harmonic and Bridger Aerospace go up and down completely randomly.

Pair Corralation between Harmonic and Bridger Aerospace

Given the investment horizon of 90 days Harmonic is expected to generate 0.41 times more return on investment than Bridger Aerospace. However, Harmonic is 2.44 times less risky than Bridger Aerospace. It trades about -0.15 of its potential returns per unit of risk. Bridger Aerospace Group is currently generating about -0.08 per unit of risk. If you would invest  1,335  in Harmonic on December 22, 2024 and sell it today you would lose (316.00) from holding Harmonic or give up 23.67% of portfolio value over 90 days.

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

Harmonic  vs.  Bridger Aerospace Group

Harmonic

Risk-Adjusted Performance

Very Weak

Over the last 90 days Harmonic has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of weak performance in the last few months, the Stock's forward indicators remain comparatively stable which may send shares a bit higher in April 2025. The newest uproar may also be a sign of mid-term up-swing for the firm private investors.

Bridger Aerospace

Risk-Adjusted Performance

Very Weak

Over the last 90 days Bridger Aerospace Group has generated negative risk-adjusted returns adding no value to investors with long positions. Even with unsteady performance in the last few months, the Stock's technical and fundamental indicators remain relatively invariable which may send shares a bit higher in April 2025. The latest agitation may also be a sign of long-running up-swing for the enterprise retail investors.

Pair Trading with Harmonic and Bridger Aerospace

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

The idea behind Harmonic and Bridger Aerospace Group 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.