Correlation Between HOLOGIC and Par Pacific

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

By analyzing existing cross correlation between HOLOGIC INC 325 and Par Pacific Holdings, you can compare the effects of market volatilities on HOLOGIC and Par Pacific 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 HOLOGIC with a short position of Par Pacific. Check out your portfolio center. Please also check ongoing floating volatility patterns of HOLOGIC and Par Pacific.

Diversification Opportunities for HOLOGIC and Par Pacific

0.56

Correlation Coefficient

HOLOGIC  Par Pacific

Very weak diversification

The 3 months correlation between HOLOGIC and Par is 0.56. Overlapping area represents the amount of risk that can be diversified away by holding HOLOGIC INC 325 and Par Pacific Holdings in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Par Pacific Holdings and HOLOGIC 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 HOLOGIC INC 325 are associated (or correlated) with Par Pacific. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Par Pacific Holdings has no effect on the direction of HOLOGIC i.e., HOLOGIC and Par Pacific go up and down completely randomly.

Pair Corralation between HOLOGIC and Par Pacific

Assuming the 90 days trading horizon HOLOGIC INC 325 is expected to under-perform the Par Pacific. But the bond apears to be less risky and, when comparing its historical volatility, HOLOGIC INC 325 is 5.57 times less risky than Par Pacific. The bond trades about -0.2 of its potential returns per unit of risk. The Par Pacific Holdings is currently generating about -0.02 of returns per unit of risk over similar time horizon. If you would invest  1,729  in Par Pacific Holdings on September 25, 2024 and sell it today you would lose (122.00) from holding Par Pacific Holdings or give up 7.06% of portfolio value over 90 days.

Time Period	3 Months [change]
Direction	Moves Together
Strength	Weak
Accuracy	93.75%
Values	Daily Returns

HOLOGIC INC 325  vs.  Par Pacific Holdings

HOLOGIC INC 325

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days HOLOGIC INC 325 has generated negative risk-adjusted returns adding no value to investors with long positions. Despite latest uncertain performance, the Bond's basic indicators remain strong and the current disturbance on Wall Street may also be a sign of long term gains for HOLOGIC INC 325 investors.

Par Pacific Holdings

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Par Pacific Holdings has generated negative risk-adjusted returns adding no value to investors with long positions. Even with relatively invariable basic indicators, Par Pacific is not utilizing all of its potentials. The latest stock price agitation, may contribute to short-term losses for the retail investors.

Pair Trading with HOLOGIC and Par Pacific

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

The idea behind HOLOGIC INC 325 and Par Pacific 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 Share Portfolio module to track or share privately all of your investments from the convenience of any device.