Correlation Between Henderson Land and Comstock Holding

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

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

Diversification Opportunities for Henderson Land and Comstock Holding

-0.87

Correlation Coefficient

Henderson Land  Comstock Holding

Pay attention - limited upside

The 3 months correlation between Henderson and Comstock is -0.87. Overlapping area represents the amount of risk that can be diversified away by holding Henderson Land and Comstock Holding Companies in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Comstock Holding Com and Henderson Land 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 Henderson Land are associated (or correlated) with Comstock Holding. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Comstock Holding Com has no effect on the direction of Henderson Land i.e., Henderson Land and Comstock Holding go up and down completely randomly.

Pair Corralation between Henderson Land and Comstock Holding

If you would invest  766.00  in Comstock Holding Companies on September 1, 2024 and sell it today you would earn a total of  50.00  from holding Comstock Holding Companies or generate 6.53% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Against
Strength	Significant
Accuracy	1.59%
Values	Daily Returns

Henderson Land  vs.  Comstock Holding Companies

Henderson Land

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Henderson Land has generated negative risk-adjusted returns adding no value to investors with long positions. Despite nearly stable basic indicators, Henderson Land is not utilizing all of its potentials. The latest stock price disturbance, may contribute to mid-run losses for the stockholders.

Comstock Holding Com

Risk-Adjusted Performance

3 of 100

Insignificant

Compared to the overall equity markets, risk-adjusted returns on investments in Comstock Holding Companies are ranked lower than 3 (%) of all global equities and portfolios over the last 90 days. Despite fairly uncertain fundamental indicators, Comstock Holding demonstrated solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with Henderson Land and Comstock Holding

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

The idea behind Henderson Land and Comstock Holding Companies 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 Investing Opportunities module to build portfolios using our predefined set of ideas and optimize them against your investing preferences.