Correlation Between Hawkins and Fly E

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

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

Diversification Opportunities for Hawkins and Fly E

-0.57

Correlation Coefficient

Hawkins  Fly E

Excellent diversification

The 3 months correlation between Hawkins and Fly is -0.57. Overlapping area represents the amount of risk that can be diversified away by holding Hawkins and Fly E Group, Common in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Fly E Group, and Hawkins 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 Hawkins are associated (or correlated) with Fly E. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Fly E Group, has no effect on the direction of Hawkins i.e., Hawkins and Fly E go up and down completely randomly.

Pair Corralation between Hawkins and Fly E

Given the investment horizon of 90 days Hawkins is expected to under-perform the Fly E. But the stock apears to be less risky and, when comparing its historical volatility, Hawkins is 2.48 times less risky than Fly E. The stock trades about -0.13 of its potential returns per unit of risk. The Fly E Group, Common is currently generating about 0.01 of returns per unit of risk over similar time horizon. If you would invest  45.00  in Fly E Group, Common on September 25, 2024 and sell it today you would lose (1.00) from holding Fly E Group, Common or give up 2.22% of portfolio value over 90 days.

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

Hawkins  vs.  Fly E Group, Common

Hawkins

Risk-Adjusted Performance

3 of 100

Weak

Compared to the overall equity markets, risk-adjusted returns on investments in Hawkins are ranked lower than 3 (%) of all global equities and portfolios over the last 90 days. In spite of very fragile forward-looking signals, Hawkins may actually be approaching a critical reversion point that can send shares even higher in January 2025.

Fly E Group,

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Fly E Group, Common has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of latest conflicting performance, the Stock's basic indicators remain sound and the latest tumult on Wall Street may also be a sign of longer-term gains for the firm shareholders.

Pair Trading with Hawkins and Fly E

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

The idea behind Hawkins and Fly E Group, Common 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 Top Crypto Exchanges module to search and analyze digital assets across top global cryptocurrency exchanges.