Correlation Between Haier Smart and Traeger

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

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

Diversification Opportunities for Haier Smart and Traeger

-0.02

Correlation Coefficient

Haier Smart  Traeger

Good diversification

The 3 months correlation between Haier and Traeger is -0.02. Overlapping area represents the amount of risk that can be diversified away by holding Haier Smart Home and Traeger in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Traeger and Haier Smart 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 Haier Smart Home are associated (or correlated) with Traeger. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Traeger has no effect on the direction of Haier Smart i.e., Haier Smart and Traeger go up and down completely randomly.

Pair Corralation between Haier Smart and Traeger

Assuming the 90 days horizon Haier Smart Home is expected to generate 0.81 times more return on investment than Traeger. However, Haier Smart Home is 1.24 times less risky than Traeger. It trades about -0.01 of its potential returns per unit of risk. Traeger is currently generating about -0.18 per unit of risk. If you would invest  1,426  in Haier Smart Home on December 26, 2024 and sell it today you would lose (53.00) from holding Haier Smart Home or give up 3.72% of portfolio value over 90 days.

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

Haier Smart Home  vs.  Traeger

Haier Smart Home

Risk-Adjusted Performance

Very Weak

Over the last 90 days Haier Smart Home has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of fairly strong fundamental indicators, Haier Smart is not utilizing all of its potentials. The latest stock price disturbance, may contribute to short-term losses for the investors.

Traeger

Risk-Adjusted Performance

Very Weak

Over the last 90 days Traeger has generated negative risk-adjusted returns adding no value to investors with long positions. Despite weak performance in the last few months, the Stock's basic indicators remain quite persistent which may send shares a bit higher in April 2025. The latest mess may also be a sign of long-standing up-swing for the company institutional investors.

Pair Trading with Haier Smart and Traeger

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

The idea behind Haier Smart Home and Traeger 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 Equity Search module to search for actively traded equities including funds and ETFs from over 30 global markets.