Correlation Between Aerofoam Metals and Hamilton Insurance

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

By analyzing existing cross correlation between Aerofoam Metals and Hamilton Insurance Group,, you can compare the effects of market volatilities on Aerofoam Metals and Hamilton Insurance 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 Aerofoam Metals with a short position of Hamilton Insurance. Check out your portfolio center. Please also check ongoing floating volatility patterns of Aerofoam Metals and Hamilton Insurance.

Diversification Opportunities for Aerofoam Metals and Hamilton Insurance

0.0

Correlation Coefficient

Aerofoam Metals  Hamilton Insurance

Pay attention - limited upside

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

Pair Corralation between Aerofoam Metals and Hamilton Insurance

If you would invest  1,849  in Hamilton Insurance Group, on September 12, 2024 and sell it today you would earn a total of  50.00  from holding Hamilton Insurance Group, or generate 2.7% return on investment over 90 days.

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

Aerofoam Metals  vs.  Hamilton Insurance Group,

Aerofoam Metals

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Aerofoam Metals has generated negative risk-adjusted returns adding no value to investors with long positions. Despite quite persistent primary indicators, Aerofoam Metals is not utilizing all of its potentials. The newest stock price mess, may contribute to short-term losses for the institutional investors.

Hamilton Insurance Group,

Risk-Adjusted Performance

2 of 100

Weak

Compared to the overall equity markets, risk-adjusted returns on investments in Hamilton Insurance Group, are ranked lower than 2 (%) of all global equities and portfolios over the last 90 days. Despite nearly stable technical and fundamental indicators, Hamilton Insurance is not utilizing all of its potentials. The latest stock price disturbance, may contribute to mid-run losses for the stockholders.

Pair Trading with Aerofoam Metals and Hamilton Insurance

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

The idea behind Aerofoam Metals and Hamilton Insurance Group, 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.

Check out your portfolio center.

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 Center module to all portfolio management and optimization tools to improve performance of your portfolios.