Correlation Between Gentex and Hemosense

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

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

Diversification Opportunities for Gentex and Hemosense

0.0

Correlation Coefficient

Gentex  Hemosense

Pay attention - limited upside

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

Pair Corralation between Gentex and Hemosense

If you would invest  0.00  in Hemosense on September 27, 2024 and sell it today you would earn a total of  0.00  from holding Hemosense or generate 0.0% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Flat
Strength	Insignificant
Accuracy	4.76%
Values	Daily Returns

Gentex  vs.  Hemosense

Gentex

Risk-Adjusted Performance

0 of 100

Very Weak

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

Hemosense

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Hemosense has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of very healthy technical and fundamental indicators, Hemosense is not utilizing all of its potentials. The current stock price disarray, may contribute to short-term losses for the investors.

Pair Trading with Gentex and Hemosense

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

The idea behind Gentex and Hemosense 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 Analyzer module to portfolio analysis module that provides access to portfolio diagnostics and optimization engine.