Correlation Between Raymond James and Hut 8

Can any of the company-specific risk be diversified away by investing in both Raymond James and Hut 8 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 Raymond James and Hut 8 into the same portfolio, which is an essential part of the fundamental portfolio management process.

By analyzing existing cross correlation between Raymond James Financial and Hut 8 Corp, you can compare the effects of market volatilities on Raymond James and Hut 8 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 Raymond James with a short position of Hut 8. Check out your portfolio center. Please also check ongoing floating volatility patterns of Raymond James and Hut 8.

Diversification Opportunities for Raymond James and Hut 8

0.92

Correlation Coefficient

Raymond James  Hut 8

Almost no diversification

The 3 months correlation between Raymond and Hut is 0.92. Overlapping area represents the amount of risk that can be diversified away by holding Raymond James Financial and Hut 8 Corp in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Hut 8 Corp and Raymond James 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 Raymond James Financial are associated (or correlated) with Hut 8. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Hut 8 Corp has no effect on the direction of Raymond James i.e., Raymond James and Hut 8 go up and down completely randomly.

Pair Corralation between Raymond James and Hut 8

Considering the 90-day investment horizon Raymond James Financial is expected to generate 0.19 times more return on investment than Hut 8. However, Raymond James Financial is 5.37 times less risky than Hut 8. It trades about -0.24 of its potential returns per unit of risk. Hut 8 Corp is currently generating about -0.08 per unit of risk. If you would invest  16,695  in Raymond James Financial on October 1, 2024 and sell it today you would lose (1,003) from holding Raymond James Financial or give up 6.01% of portfolio value over 90 days.

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

Raymond James Financial  vs.  Hut 8 Corp

Raymond James Financial

Risk-Adjusted Performance

15 of 100

Good

Compared to the overall equity markets, risk-adjusted returns on investments in Raymond James Financial are ranked lower than 15 (%) of all global equities and portfolios over the last 90 days. Despite nearly weak forward-looking indicators, Raymond James reported solid returns over the last few months and may actually be approaching a breakup point.

Hut 8 Corp

Risk-Adjusted Performance

14 of 100

Good

Compared to the overall equity markets, risk-adjusted returns on investments in Hut 8 Corp are ranked lower than 14 (%) of all global equities and portfolios over the last 90 days. In spite of comparatively unsteady basic indicators, Hut 8 unveiled solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with Raymond James and Hut 8

The main advantage of trading using opposite Raymond James and Hut 8 positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Raymond James position performs unexpectedly, Hut 8 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 Hut 8 will offset losses from the drop in Hut 8's long position.

The idea behind Raymond James Financial and Hut 8 Corp 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 Pattern Recognition module to use different Pattern Recognition models to time the market across multiple global exchanges.