Correlation Between Integrated Drilling and Hafnia

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

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

Diversification Opportunities for Integrated Drilling and Hafnia

0.0

Correlation Coefficient

Integrated Drilling  Hafnia

Pay attention - limited upside

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

Pair Corralation between Integrated Drilling and Hafnia

If you would invest  526.00  in Hafnia Limited on October 8, 2024 and sell it today you would earn a total of  29.00  from holding Hafnia Limited or generate 5.51% return on investment over 90 days.

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

Integrated Drilling Equipment  vs.  Hafnia Limited

Integrated Drilling

Risk-Adjusted Performance

0 of 100

Very Weak

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

Hafnia Limited

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Hafnia Limited 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 technical and fundamental indicators remain very healthy which may send shares a bit higher in February 2025. The recent disarray may also be a sign of long period up-swing for the firm investors.

Pair Trading with Integrated Drilling and Hafnia

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

The idea behind Integrated Drilling Equipment and Hafnia Limited 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 Stock Screener module to find equities using a custom stock filter or screen asymmetry in trading patterns, price, volume, or investment outlook..