Correlation Between Hsi Malls and Hsi Logistica

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

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

Diversification Opportunities for Hsi Malls and Hsi Logistica

0.8

Correlation Coefficient

Hsi Malls  Hsi Logistica

Very poor diversification

The 3 months correlation between Hsi and Hsi is 0.8. Overlapping area represents the amount of risk that can be diversified away by holding Hsi Malls Fundo and Hsi Logistica Fundo in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Hsi Logistica Fundo and Hsi Malls 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 Hsi Malls Fundo are associated (or correlated) with Hsi Logistica. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Hsi Logistica Fundo has no effect on the direction of Hsi Malls i.e., Hsi Malls and Hsi Logistica go up and down completely randomly.

Pair Corralation between Hsi Malls and Hsi Logistica

Assuming the 90 days trading horizon Hsi Malls Fundo is expected to under-perform the Hsi Logistica. But the fund apears to be less risky and, when comparing its historical volatility, Hsi Malls Fundo is 1.3 times less risky than Hsi Logistica. The fund trades about -0.08 of its potential returns per unit of risk. The Hsi Logistica Fundo is currently generating about -0.04 of returns per unit of risk over similar time horizon. If you would invest  7,804  in Hsi Logistica Fundo on October 9, 2024 and sell it today you would lose (134.00) from holding Hsi Logistica Fundo or give up 1.72% of portfolio value over 90 days.

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

Hsi Malls Fundo  vs.  Hsi Logistica Fundo

Hsi Malls Fundo

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Hsi Malls Fundo has generated negative risk-adjusted returns adding no value to fund investors. Despite weak performance in the last few months, the Fund's primary indicators remain somewhat strong which may send shares a bit higher in February 2025. The current disturbance may also be a sign of long term up-swing for the fund investors.

Hsi Logistica Fundo

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Hsi Logistica Fundo has generated negative risk-adjusted returns adding no value to fund investors. Despite somewhat strong essential indicators, Hsi Logistica is not utilizing all of its potentials. The current stock price disturbance, may contribute to short-term losses for the investors.

Pair Trading with Hsi Malls and Hsi Logistica

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

The idea behind Hsi Malls Fundo and Hsi Logistica Fundo 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 Crypto Correlations module to use cryptocurrency correlation module to diversify your cryptocurrency portfolio across multiple coins.