Correlation Between BECLE SAB and Hawesko Holding

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

By analyzing existing cross correlation between BECLE SAB DE and Hawesko Holding AG, you can compare the effects of market volatilities on BECLE SAB and Hawesko Holding 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 BECLE SAB with a short position of Hawesko Holding. Check out your portfolio center. Please also check ongoing floating volatility patterns of BECLE SAB and Hawesko Holding.

Diversification Opportunities for BECLE SAB and Hawesko Holding

0.61

Correlation Coefficient

BECLE SAB  Hawesko Holding

Poor diversification

The 3 months correlation between BECLE and Hawesko is 0.61. Overlapping area represents the amount of risk that can be diversified away by holding BECLE SAB DE and Hawesko Holding AG in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Hawesko Holding AG and BECLE SAB 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 BECLE SAB DE are associated (or correlated) with Hawesko Holding. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Hawesko Holding AG has no effect on the direction of BECLE SAB i.e., BECLE SAB and Hawesko Holding go up and down completely randomly.

Pair Corralation between BECLE SAB and Hawesko Holding

Assuming the 90 days horizon BECLE SAB DE is expected to under-perform the Hawesko Holding. But the stock apears to be less risky and, when comparing its historical volatility, BECLE SAB DE is 1.79 times less risky than Hawesko Holding. The stock trades about -0.15 of its potential returns per unit of risk. The Hawesko Holding AG is currently generating about 0.29 of returns per unit of risk over similar time horizon. If you would invest  2,240  in Hawesko Holding AG on September 26, 2024 and sell it today you would earn a total of  530.00  from holding Hawesko Holding AG or generate 23.66% return on investment over 90 days.

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

BECLE SAB DE  vs.  Hawesko Holding AG

BECLE SAB DE

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days BECLE SAB DE has generated negative risk-adjusted returns adding no value to investors with long positions. Despite fragile performance in the last few months, the Stock's basic indicators remain nearly stable which may send shares a bit higher in January 2025. The current disturbance may also be a sign of long-run up-swing for the company stockholders.

Hawesko Holding AG

Risk-Adjusted Performance

3 of 100

Insignificant

Compared to the overall equity markets, risk-adjusted returns on investments in Hawesko Holding AG are ranked lower than 3 (%) of all global equities and portfolios over the last 90 days. Despite nearly fragile basic indicators, Hawesko Holding may actually be approaching a critical reversion point that can send shares even higher in January 2025.

Pair Trading with BECLE SAB and Hawesko Holding

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

The idea behind BECLE SAB DE and Hawesko Holding AG 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 Idea Breakdown module to analyze constituents of all Macroaxis ideas. Macroaxis investment ideas are predefined, sector-focused investing themes.