Correlation Between HSBC Bloomberg and HSBC NASDAQ

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

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

Diversification Opportunities for HSBC Bloomberg and HSBC NASDAQ

0.0

Correlation Coefficient

HSBC Bloomberg  HSBC NASDAQ

Pay attention - limited upside

The 3 months correlation between HSBC and HSBC is 0.0. Overlapping area represents the amount of risk that can be diversified away by holding HSBC Bloomberg USD and HSBC NASDAQ Global in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on HSBC NASDAQ Global and HSBC Bloomberg 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 HSBC Bloomberg USD are associated (or correlated) with HSBC NASDAQ. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of HSBC NASDAQ Global has no effect on the direction of HSBC Bloomberg i.e., HSBC Bloomberg and HSBC NASDAQ go up and down completely randomly.

Pair Corralation between HSBC Bloomberg and HSBC NASDAQ

If you would invest (100.00) in HSBC Bloomberg USD on December 2, 2024 and sell it today you would earn a total of  100.00  from holding HSBC Bloomberg USD or generate -100.0% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Flat
Strength	Insignificant
Accuracy	0.0%
Values	Daily Returns

HSBC Bloomberg USD  vs.  HSBC NASDAQ Global

HSBC Bloomberg USD

Risk-Adjusted Performance

Very Weak

Over the last 90 days HSBC Bloomberg USD has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of rather sound fundamental indicators, HSBC Bloomberg is not utilizing all of its potentials. The latest stock price tumult, may contribute to shorter-term losses for the shareholders.

HSBC NASDAQ Global

Risk-Adjusted Performance

Very Weak

Over the last 90 days HSBC NASDAQ Global has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of comparatively stable basic indicators, HSBC NASDAQ is not utilizing all of its potentials. The latest stock price uproar, may contribute to short-horizon losses for the private investors.

Pair Trading with HSBC Bloomberg and HSBC NASDAQ

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

The idea behind HSBC Bloomberg USD and HSBC NASDAQ Global 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 Aroon Oscillator module to analyze current equity momentum using Aroon Oscillator and other momentum ratios.