Correlation Between Hudson Global and TrueBlue

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

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

Diversification Opportunities for Hudson Global and TrueBlue

0.94

Correlation Coefficient

Hudson Global  TrueBlue

Almost no diversification

The 3 months correlation between Hudson and TrueBlue is 0.94. Overlapping area represents the amount of risk that can be diversified away by holding Hudson Global and TrueBlue in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on TrueBlue and Hudson Global 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 Hudson Global are associated (or correlated) with TrueBlue. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of TrueBlue has no effect on the direction of Hudson Global i.e., Hudson Global and TrueBlue go up and down completely randomly.

Pair Corralation between Hudson Global and TrueBlue

Given the investment horizon of 90 days Hudson Global is expected to generate 0.54 times more return on investment than TrueBlue. However, Hudson Global is 1.84 times less risky than TrueBlue. It trades about -0.12 of its potential returns per unit of risk. TrueBlue is currently generating about -0.11 per unit of risk. If you would invest  1,289  in Hudson Global on December 29, 2024 and sell it today you would lose (210.00) from holding Hudson Global or give up 16.29% of portfolio value over 90 days.

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

Hudson Global  vs.  TrueBlue

Hudson Global

Risk-Adjusted Performance

Very Weak

Over the last 90 days Hudson Global has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of inconsistent performance in the last few months, the Stock's basic indicators remain very healthy which may send shares a bit higher in April 2025. The recent disarray may also be a sign of long period up-swing for the firm investors.

TrueBlue

Risk-Adjusted Performance

Very Weak

Over the last 90 days TrueBlue 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 fundamental drivers remain fairly strong which may send shares a bit higher in April 2025. The recent confusion may also be a sign of long-lasting up-swing for the firm traders.

Pair Trading with Hudson Global and TrueBlue

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

The idea behind Hudson Global and TrueBlue 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 Positions Ratings module to determine portfolio positions ratings based on digital equity recommendations. Macroaxis instant position ratings are based on combination of fundamental analysis and risk-adjusted market performance.