Correlation Between Codexis and Hawkins

Specify exactly 2 symbols:
Can any of the company-specific risk be diversified away by investing in both Codexis and Hawkins 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 Codexis and Hawkins into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Codexis and Hawkins, you can compare the effects of market volatilities on Codexis and Hawkins 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 Codexis with a short position of Hawkins. Check out your portfolio center. Please also check ongoing floating volatility patterns of Codexis and Hawkins.

Diversification Opportunities for Codexis and Hawkins

0.52
  Correlation Coefficient

Very weak diversification

The 3 months correlation between Codexis and Hawkins is 0.52. Overlapping area represents the amount of risk that can be diversified away by holding Codexis and Hawkins in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Hawkins and Codexis 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 Codexis are associated (or correlated) with Hawkins. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Hawkins has no effect on the direction of Codexis i.e., Codexis and Hawkins go up and down completely randomly.

Pair Corralation between Codexis and Hawkins

Given the investment horizon of 90 days Codexis is expected to generate 1.63 times more return on investment than Hawkins. However, Codexis is 1.63 times more volatile than Hawkins. It trades about 0.23 of its potential returns per unit of risk. Hawkins is currently generating about 0.11 per unit of risk. If you would invest  281.00  in Codexis on September 5, 2024 and sell it today you would earn a total of  196.00  from holding Codexis or generate 69.75% return on investment over 90 days.
Time Period3 Months [change]
DirectionMoves Together 
StrengthWeak
Accuracy100.0%
ValuesDaily Returns

Codexis  vs.  Hawkins

 Performance 
       Timeline  
Codexis 

Risk-Adjusted Performance

17 of 100

 
Weak
 
Strong
Solid
Compared to the overall equity markets, risk-adjusted returns on investments in Codexis are ranked lower than 17 (%) of all global equities and portfolios over the last 90 days. In spite of comparatively weak basic indicators, Codexis unveiled solid returns over the last few months and may actually be approaching a breakup point.
Hawkins 

Risk-Adjusted Performance

8 of 100

 
Weak
 
Strong
OK
Compared to the overall equity markets, risk-adjusted returns on investments in Hawkins are ranked lower than 8 (%) of all global equities and portfolios over the last 90 days. In spite of very conflicting forward-looking signals, Hawkins displayed solid returns over the last few months and may actually be approaching a breakup point.

Codexis and Hawkins Volatility Contrast

   Predicted Return Density   
       Returns  

Pair Trading with Codexis and Hawkins

The main advantage of trading using opposite Codexis and Hawkins positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Codexis position performs unexpectedly, Hawkins 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 Hawkins will offset losses from the drop in Hawkins' long position.
The idea behind Codexis and Hawkins 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 Options Analysis module to analyze and evaluate options and option chains as a potential hedge for your portfolios.

Other Complementary Tools

Latest Portfolios
Quick portfolio dashboard that showcases your latest portfolios
Analyst Advice
Analyst recommendations and target price estimates broken down by several categories
Volatility Analysis
Get historical volatility and risk analysis based on latest market data
Portfolio Suggestion
Get suggestions outside of your existing asset allocation including your own model portfolios
Portfolio Analyzer
Portfolio analysis module that provides access to portfolio diagnostics and optimization engine