Correlation Between Haleon Plc and Pyramidion Technology

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

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

Diversification Opportunities for Haleon Plc and Pyramidion Technology

0.65

Correlation Coefficient

Haleon Plc  Pyramidion Technology

Poor diversification

The 3 months correlation between Haleon and Pyramidion is 0.65. Overlapping area represents the amount of risk that can be diversified away by holding Haleon plc and Pyramidion Technology Group in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Pyramidion Technology and Haleon Plc 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 Haleon plc are associated (or correlated) with Pyramidion Technology. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Pyramidion Technology has no effect on the direction of Haleon Plc i.e., Haleon Plc and Pyramidion Technology go up and down completely randomly.

Pair Corralation between Haleon Plc and Pyramidion Technology

Considering the 90-day investment horizon Haleon plc is expected to generate 0.06 times more return on investment than Pyramidion Technology. However, Haleon plc is 17.23 times less risky than Pyramidion Technology. It trades about -0.15 of its potential returns per unit of risk. Pyramidion Technology Group is currently generating about -0.03 per unit of risk. If you would invest  1,065  in Haleon plc on September 17, 2024 and sell it today you would lose (93.00) from holding Haleon plc or give up 8.73% of portfolio value over 90 days.

Time Period	3 Months [change]
Direction	Moves Together
Strength	Significant
Accuracy	98.46%
Values	Daily Returns

Haleon plc  vs.  Pyramidion Technology Group

Haleon plc

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Haleon plc has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of latest weak performance, the Stock's essential indicators remain healthy and the recent disarray on Wall Street may also be a sign of long period gains for the firm investors.

Pyramidion Technology

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Pyramidion Technology Group 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 technical and fundamental indicators remain somewhat strong which may send shares a bit higher in January 2025. The current disturbance may also be a sign of long term up-swing for the company investors.

Pair Trading with Haleon Plc and Pyramidion Technology

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

The idea behind Haleon plc and Pyramidion Technology 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.

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 Risk-Return Analysis module to view associations between returns expected from investment and the risk you assume.