Correlation Between Boxlight Corp and H D

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Can any of the company-specific risk be diversified away by investing in both Boxlight Corp and H D 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 Boxlight Corp and H D into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Boxlight Corp Class and H D International Holdings, you can compare the effects of market volatilities on Boxlight Corp and H D 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 Boxlight Corp with a short position of H D. Check out your portfolio center. Please also check ongoing floating volatility patterns of Boxlight Corp and H D.

Diversification Opportunities for Boxlight Corp and H D

0.51
  Correlation Coefficient

Very weak diversification

The 3 months correlation between Boxlight and HDIH is 0.51. Overlapping area represents the amount of risk that can be diversified away by holding Boxlight Corp Class and H D International Holdings in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on H D International and Boxlight Corp 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 Boxlight Corp Class are associated (or correlated) with H D. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of H D International has no effect on the direction of Boxlight Corp i.e., Boxlight Corp and H D go up and down completely randomly.

Pair Corralation between Boxlight Corp and H D

Given the investment horizon of 90 days Boxlight Corp Class is expected to under-perform the H D. But the stock apears to be less risky and, when comparing its historical volatility, Boxlight Corp Class is 1.29 times less risky than H D. The stock trades about -0.08 of its potential returns per unit of risk. The H D International Holdings is currently generating about 0.03 of returns per unit of risk over similar time horizon. If you would invest  0.02  in H D International Holdings on September 20, 2024 and sell it today you would earn a total of  0.00  from holding H D International Holdings or generate 0.0% return on investment over 90 days.
Time Period3 Months [change]
DirectionMoves Together 
StrengthWeak
Accuracy98.44%
ValuesDaily Returns

Boxlight Corp Class  vs.  H D International Holdings

 Performance 
       Timeline  
Boxlight Corp Class 

Risk-Adjusted Performance

0 of 100

 
Weak
 
Strong
Very Weak
Over the last 90 days Boxlight Corp Class has generated negative risk-adjusted returns adding no value to investors with long positions. Despite weak performance in the last few months, the Stock's basic indicators remain quite persistent which may send shares a bit higher in January 2025. The latest mess may also be a sign of long-standing up-swing for the company institutional investors.
H D International 

Risk-Adjusted Performance

2 of 100

 
Weak
 
Strong
Weak
Compared to the overall equity markets, risk-adjusted returns on investments in H D International Holdings are ranked lower than 2 (%) of all global equities and portfolios over the last 90 days. Despite fairly conflicting forward indicators, H D demonstrated solid returns over the last few months and may actually be approaching a breakup point.

Boxlight Corp and H D Volatility Contrast

   Predicted Return Density   
       Returns  

Pair Trading with Boxlight Corp and H D

The main advantage of trading using opposite Boxlight Corp and H D positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Boxlight Corp position performs unexpectedly, H D 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 H D will offset losses from the drop in H D's long position.
The idea behind Boxlight Corp Class and H D International Holdings 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 Technical Analysis module to check basic technical indicators and analysis based on most latest market data.

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