Correlation Between Signet International and Healthier Choices

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

By analyzing existing cross correlation between Signet International Holdings and Healthier Choices Management, you can compare the effects of market volatilities on Signet International and Healthier Choices 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 Signet International with a short position of Healthier Choices. Check out your portfolio center. Please also check ongoing floating volatility patterns of Signet International and Healthier Choices.

Diversification Opportunities for Signet International and Healthier Choices

0.0

Correlation Coefficient

Signet International  Healthier Choices

Pay attention - limited upside

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

Pair Corralation between Signet International and Healthier Choices

If you would invest  0.00  in Healthier Choices Management on August 31, 2024 and sell it today you would earn a total of  0.00  from holding Healthier Choices Management or generate 0.0% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Flat
Strength	Insignificant
Accuracy	97.73%
Values	Daily Returns

Signet International Holdings  vs.  Healthier Choices Management

Signet International

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Signet International Holdings has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of fairly stable basic indicators, Signet International is not utilizing all of its potentials. The current stock price fuss, may contribute to near-short-term losses for the sophisticated investors.

Healthier Choices

Risk-Adjusted Performance

34 of 100

Very Strong

Compared to the overall equity markets, risk-adjusted returns on investments in Healthier Choices Management are ranked lower than 34 (%) of all global equities and portfolios over the last 90 days. In spite of rather abnormal primary indicators, Healthier Choices exhibited solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with Signet International and Healthier Choices

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

The idea behind Signet International Holdings and Healthier Choices Management 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 Stock Screener module to find equities using a custom stock filter or screen asymmetry in trading patterns, price, volume, or investment outlook..