Correlation Between HSBC Holdings and CrowdStrike Holdings,

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

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

Diversification Opportunities for HSBC Holdings and CrowdStrike Holdings,

0.85

Correlation Coefficient

HSBC Holdings  CrowdStrike Holdings,

Very poor diversification

The 3 months correlation between HSBC and CrowdStrike is 0.85. Overlapping area represents the amount of risk that can be diversified away by holding HSBC Holdings plc and CrowdStrike Holdings, in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on CrowdStrike Holdings, and HSBC Holdings 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 HSBC Holdings plc are associated (or correlated) with CrowdStrike Holdings,. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of CrowdStrike Holdings, has no effect on the direction of HSBC Holdings i.e., HSBC Holdings and CrowdStrike Holdings, go up and down completely randomly.

Pair Corralation between HSBC Holdings and CrowdStrike Holdings,

Assuming the 90 days trading horizon HSBC Holdings is expected to generate 1.31 times less return on investment than CrowdStrike Holdings,. In addition to that, HSBC Holdings is 1.0 times more volatile than CrowdStrike Holdings,. It trades about 0.13 of its total potential returns per unit of risk. CrowdStrike Holdings, is currently generating about 0.18 per unit of volatility. If you would invest  556,470  in CrowdStrike Holdings, on September 27, 2024 and sell it today you would earn a total of  173,572  from holding CrowdStrike Holdings, or generate 31.19% return on investment over 90 days.

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

HSBC Holdings plc  vs.  CrowdStrike Holdings,

HSBC Holdings plc

Risk-Adjusted Performance

10 of 100

OK

Compared to the overall equity markets, risk-adjusted returns on investments in HSBC Holdings plc are ranked lower than 10 (%) of all global equities and portfolios over the last 90 days. In spite of fairly weak basic indicators, HSBC Holdings showed solid returns over the last few months and may actually be approaching a breakup point.

CrowdStrike Holdings,

Risk-Adjusted Performance

13 of 100

Good

Compared to the overall equity markets, risk-adjusted returns on investments in CrowdStrike Holdings, are ranked lower than 13 (%) of all global equities and portfolios over the last 90 days. In spite of fairly weak basic indicators, CrowdStrike Holdings, showed solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with HSBC Holdings and CrowdStrike Holdings,

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

The idea behind HSBC Holdings plc and CrowdStrike 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 Portfolio Optimization module to compute new portfolio that will generate highest expected return given your specified tolerance for risk.