Correlation Between Hyrican Informationssyst and Loews Corp

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

By analyzing existing cross correlation between Hyrican Informationssysteme Aktiengesellschaft and Loews Corp, you can compare the effects of market volatilities on Hyrican Informationssyst and Loews Corp 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 Hyrican Informationssyst with a short position of Loews Corp. Check out your portfolio center. Please also check ongoing floating volatility patterns of Hyrican Informationssyst and Loews Corp.

Diversification Opportunities for Hyrican Informationssyst and Loews Corp

0.0

Correlation Coefficient

Hyrican Informationssyst  Loews Corp

Pay attention - limited upside

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

Pair Corralation between Hyrican Informationssyst and Loews Corp

Assuming the 90 days horizon Hyrican Informationssysteme Aktiengesellschaft is expected to under-perform the Loews Corp. But the stock apears to be less risky and, when comparing its historical volatility, Hyrican Informationssysteme Aktiengesellschaft is 4.44 times less risky than Loews Corp. The stock trades about -0.1 of its potential returns per unit of risk. The Loews Corp is currently generating about 0.02 of returns per unit of risk over similar time horizon. If you would invest  7,994  in Loews Corp on December 21, 2024 and sell it today you would earn a total of  56.00  from holding Loews Corp or generate 0.7% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Flat
Strength	Insignificant
Accuracy	98.33%
Values	Daily Returns

Hyrican Informationssysteme Ak  vs.  Loews Corp

Hyrican Informationssyst

Risk-Adjusted Performance

Very Weak

Over the last 90 days Hyrican Informationssysteme Aktiengesellschaft has generated negative risk-adjusted returns adding no value to investors with long positions. Despite nearly stable basic indicators, Hyrican Informationssyst is not utilizing all of its potentials. The current stock price disturbance, may contribute to mid-run losses for the stockholders.

Loews Corp

Risk-Adjusted Performance

Weak

Compared to the overall equity markets, risk-adjusted returns on investments in Loews Corp are ranked lower than 1 (%) of all global equities and portfolios over the last 90 days. In spite of rather sound basic indicators, Loews Corp is not utilizing all of its potentials. The latest stock price tumult, may contribute to shorter-term losses for the shareholders.

Pair Trading with Hyrican Informationssyst and Loews Corp

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

The idea behind Hyrican Informationssysteme Aktiengesellschaft and Loews Corp 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 My Watchlist Analysis module to analyze my current watchlist and to refresh optimization strategy. Macroaxis watchlist is based on self-learning algorithm to remember stocks you like.