Correlation Between Model N and Hitek Global

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

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

Diversification Opportunities for Model N and Hitek Global

0.0

Correlation Coefficient

Model N  Hitek Global

Pay attention - limited upside

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

Pair Corralation between Model N and Hitek Global

If you would invest (100.00) in Model N on December 2, 2024 and sell it today you would earn a total of  100.00  from holding Model N 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

Model N  vs.  Hitek Global Ordinary

Model N

Risk-Adjusted Performance

Very Weak

Over the last 90 days Model N has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of very healthy fundamental indicators, Model N is not utilizing all of its potentials. The recent stock price disarray, may contribute to short-term losses for the investors.

Hitek Global Ordinary

Risk-Adjusted Performance

Very Weak

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

Pair Trading with Model N and Hitek Global

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

The idea behind Model N and Hitek Global Ordinary 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 Portfolio File Import module to quickly import all of your third-party portfolios from your local drive in csv format.