Correlation Between Exor NV and HAL Trust

Can any of the company-specific risk be diversified away by investing in both Exor NV and HAL Trust 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 Exor NV and HAL Trust into the same portfolio, which is an essential part of the fundamental portfolio management process.

By analyzing existing cross correlation between Exor NV and HAL Trust, you can compare the effects of market volatilities on Exor NV and HAL Trust 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 Exor NV with a short position of HAL Trust. Check out your portfolio center. Please also check ongoing floating volatility patterns of Exor NV and HAL Trust.

Diversification Opportunities for Exor NV and HAL Trust

0.54

Correlation Coefficient

Exor NV  HAL Trust

Very weak diversification

The 3 months correlation between Exor and HAL is 0.54. Overlapping area represents the amount of risk that can be diversified away by holding Exor NV and HAL Trust in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on HAL Trust and Exor NV 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 Exor NV are associated (or correlated) with HAL Trust. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of HAL Trust has no effect on the direction of Exor NV i.e., Exor NV and HAL Trust go up and down completely randomly.

Pair Corralation between Exor NV and HAL Trust

Assuming the 90 days trading horizon Exor NV is expected to under-perform the HAL Trust. In addition to that, Exor NV is 2.15 times more volatile than HAL Trust. It trades about -0.22 of its total potential returns per unit of risk. HAL Trust is currently generating about -0.06 per unit of volatility. If you would invest  11,400  in HAL Trust on September 19, 2024 and sell it today you would lose (80.00) from holding HAL Trust or give up 0.7% of portfolio value over 90 days.

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

Exor NV  vs.  HAL Trust

Exor NV

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Exor NV has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of latest weak performance, the Stock's basic indicators remain stable and the newest uproar on Wall Street may also be a sign of mid-term gains for the firm private investors.

HAL Trust

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days HAL Trust has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of comparatively stable essential indicators, HAL Trust is not utilizing all of its potentials. The current stock price uproar, may contribute to short-horizon losses for the private investors.

Pair Trading with Exor NV and HAL Trust

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

The idea behind Exor NV and HAL Trust 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 Earnings Calls module to check upcoming earnings announcements updated hourly across public exchanges.