Hon Hai (UK) Volatility
| HHPD Stock | 12.08 0.18 1.51% |
Currently, Hon Hai Precision is not too volatile. Hon Hai Precision holds Efficiency (Sharpe) Ratio of 0.0631, which attests that the entity had a 0.0631% return per unit of risk over the last 3 months. We have found twenty-nine technical indicators for Hon Hai Precision, which you can use to evaluate the volatility of the firm. Please check out Hon Hai's Downside Deviation of 1.99, risk adjusted performance of 0.0404, and Market Risk Adjusted Performance of 0.5007 to validate if the risk estimate we provide is consistent with the expected return of 0.12%. Key indicators related to Hon Hai's volatility include:
720 Days Market Risk | Chance Of Distress | 720 Days Economic Sensitivity |
Hon Hai Stock volatility depicts how high the prices fluctuate around the mean (or its average) price. In other words, it is a statistical measure of the distribution of Hon daily returns, and it is calculated using variance and standard deviation. We also use Hon's beta, its sensitivity to the market, as well as its odds of financial distress to provide a more practical estimation of Hon Hai volatility.
Hon |
Since volatility provides investors with entry points to take advantage of stock prices, companies, such as Hon Hai can benefit from it. Downward market volatility can be a perfect environment for investors who play the long game. Here, they may decide to buy additional stocks of Hon Hai at lower prices. For example, an investor can purchase Hon stock that has halved in price over a short period. This will lower your average cost per share, thereby improving your portfolio's performance when the markets normalize. Similarly, when the prices of Hon Hai's stock rises, investors can sell out and invest the proceeds in other equities with better opportunities. Investing when markets are volatile with better valuations will accord both investors and companies the opportunity to generate better long-term returns.
Moving against Hon Stock
| 0.86 | VRS | Versarien PLC | PairCorr |
| 0.74 | HDD | Hardide PLC | PairCorr |
| 0.55 | ARGO | Argo Group Limited | PairCorr |
| 0.44 | TUN | Tungsten West PLC | PairCorr |
Hon Hai Market Sensitivity And Downside Risk
Hon Hai's beta coefficient measures the volatility of Hon stock compared to the systematic risk of the entire market represented by your selected benchmark. In mathematical terms, beta represents the slope of the line through a regression of data points where each of these points represents Hon stock's returns against your selected market. In other words, Hon Hai's beta of 0.16 provides an investor with an approximation of how much risk Hon Hai stock can potentially add to one of your existing portfolios. Hon Hai Precision has relatively low volatility with skewness of -0.04 and kurtosis of -0.58. Understanding different market volatility trends often help investors to time the market. Properly using volatility indicators enable traders to measure Hon Hai's stock risk against market volatility during both bullish and bearish trends. The higher level of volatility that comes with bear markets can directly impact Hon Hai's stock price while adding stress to investors as they watch their shares' value plummet. This usually forces investors to rebalance their portfolios by buying different financial instruments as prices fall.
3 Months Beta |Analyze Hon Hai Precision Demand TrendCheck current 90 days Hon Hai correlation with market (Dow Jones Industrial)Hon Beta |
Hon standard deviation measures the daily dispersion of prices over your selected time horizon relative to its mean. A typical volatile entity has a high standard deviation, while the deviation of a stable instrument is usually low. As a downside, the standard deviation calculates all uncertainty as risk, even when it is in your favor, such as above-average returns.
Standard Deviation | 1.98 |
It is essential to understand the difference between upside risk (as represented by Hon Hai's standard deviation) and the downside risk, which can be measured by semi-deviation or downside deviation of Hon Hai's daily returns or price. Since the actual investment returns on holding a position in hon stock tend to have a non-normal distribution, there will be different probabilities for losses than for gains. The likelihood of losses is reflected in the downside risk of an investment in Hon Hai.
Hon Hai Precision Stock Volatility Analysis
Volatility refers to the frequency at which Hon Hai stock price increases or decreases within a specified period. These fluctuations usually indicate the level of risk that's associated with Hon Hai's price changes. Investors will then calculate the volatility of Hon Hai's stock to predict their future moves. A stock that has erratic price changes quickly hits new highs, and lows are considered highly volatile. A stock with relatively stable price changes has low volatility. A highly volatile stock is riskier, but the risk cuts both ways. Investing in highly volatile security can either be highly successful, or you may experience significant failure. There are two main types of Hon Hai's volatility:
Historical Volatility
This type of stock volatility measures Hon Hai's fluctuations based on previous trends. It's commonly used to predict Hon Hai's future behavior based on its past. However, it cannot conclusively determine the future direction of the stock.Implied Volatility
This type of volatility provides a positive outlook on future price fluctuations for Hon Hai's current market price. This means that the stock will return to its initially predicted market price. This type of volatility can be derived from derivative instruments written on Hon Hai's to be redeemed at a future date.Transformation |
The output start index for this execution was zero with a total number of output elements of sixty-one. Hon Hai Precision Average Price is the average of the sum of open, high, low and close daily prices of a bar. It can be used to smooth an indicator that normally takes just the closing price as input.
Hon Hai Projected Return Density Against Market
Assuming the 90 days trading horizon Hon Hai has a beta of 0.16 . This usually indicates as returns on the market go up, Hon Hai average returns are expected to increase less than the benchmark. However, during the bear market, the loss on holding Hon Hai Precision will be expected to be much smaller as well.Most traded equities are subject to two types of risk - systematic (i.e., market) and unsystematic (i.e., nonmarket or company-specific) risk. Unsystematic risk is the risk that events specific to Hon Hai or Electronic Equipment, Instruments & Components sector will adversely affect the stock's price. This type of risk can be diversified away by owning several different stocks in different industries whose stock prices have shown a small correlation to each other. On the other hand, systematic risk is the risk that Hon Hai's price will be affected by overall stock market movements and cannot be diversified away. So, no matter how many positions you have, you cannot eliminate market risk. However, you can measure a Hon stock's historical response to market movements and buy it if you are comfortable with its volatility direction. Beta and standard deviation are two commonly used measures to help you make the right decision.
Hon Hai Precision has an alpha of 0.0581, implying that it can generate a 0.0581 percent excess return over Dow Jones Industrial after adjusting for the inherited market risk (beta). Predicted Return Density |
| Returns |
What Drives a Hon Hai Price Volatility?
Several factors can influence a stock's market volatility:Industry
Specific events can influence volatility within a particular industry. For instance, a significant weather upheaval in a crucial oil-production site may cause oil prices to increase in the oil sector. The direct result will be the rise in the stock price of oil distribution companies. Similarly, any government regulation in a specific industry could negatively influence stock prices due to increased regulations on compliance that may impact the company's future earnings and growth.Political and Economic environment
When governments make significant decisions regarding trade agreements, policies, and legislation regarding specific industries, they will influence stock prices. Everything from speeches to elections may influence investors, who can directly influence the stock prices in any particular industry. The prevailing economic situation also plays a significant role in stock prices. When the economy is doing well, investors will have a positive reaction and hence, better stock prices and vice versa.The Company's Performance
Sometimes volatility will only affect an individual company. For example, a revolutionary product launch or strong earnings report may attract many investors to purchase the company. This positive attention will raise the company's stock price. In contrast, product recalls and data breaches may negatively influence a company's stock prices.Hon Hai Stock Risk Measures
Assuming the 90 days trading horizon the coefficient of variation of Hon Hai is 1585.67. The daily returns are distributed with a variance of 3.91 and standard deviation of 1.98. The mean deviation of Hon Hai Precision is currently at 1.58. For similar time horizon, the selected benchmark (Dow Jones Industrial) has volatility of 0.76
α | Alpha over Dow Jones | 0.06 | |
β | Beta against Dow Jones | 0.16 | |
σ | Overall volatility | 1.98 | |
Ir | Information ratio | -0.02 |
Hon Hai Stock Return Volatility
Hon Hai historical daily return volatility represents how much of Hon Hai stock's daily returns swing around its mean - it is a statistical measure of its dispersion of returns. The firm accepts 1.9779% volatility on return distribution over the 90 days horizon. By contrast, Dow Jones Industrial accepts 0.7444% volatility on return distribution over the 90 days horizon. Performance |
| Timeline |
About Hon Hai Volatility
Volatility is a rate at which the price of Hon Hai or any other equity instrument increases or decreases for a given set of returns. It is measured by calculating the standard deviation of the annualized returns over a given period of time and shows the range to which the price of Hon Hai may increase or decrease. In other words, similar to Hon's beta indicator, it measures the risk of Hon Hai and helps estimate the fluctuations that may happen in a short period of time. So if prices of Hon Hai fluctuate rapidly in a short time span, it is termed to have high volatility, and if it swings slowly in a more extended period, it is understood to have low volatility.
Please read more on our technical analysis page.| Last Reported | Projected for Next Year | ||
| Selling And Marketing Expenses | 25 B | 36.6 B |
Hon Hai's stock volatility refers to the amount of uncertainty or risk involved with the size of changes in its stock's price. It is a statistical measure of the dispersion of returns on Hon Stock over a specified period of time, often expressed as the standard deviation of daily returns. In other words, it measures how much Hon Hai's price varies over time.
3 ways to utilize Hon Hai's volatility to invest better
Higher Hon Hai's stock volatility means that the price of its stock is changing rapidly and unpredictably, while lower stock volatility indicates that the price of Hon Hai Precision stock is relatively stable. Investors and traders use stock volatility as an indicator of risk and potential reward, as stocks with higher volatility can offer the potential for more significant returns but also come with a greater risk of losses. Hon Hai Precision stock volatility can provide helpful information for making investment decisions in the following ways:- Measuring Risk: Volatility can be used as a measure of risk, which can help you determine the potential fluctuations in the value of Hon Hai Precision investment. A higher volatility means higher risk and potentially larger changes in value.
- Identifying Opportunities: High volatility in Hon Hai's stock can indicate that there is potential for significant price movements, either up or down, which could present investment opportunities.
- Diversification: Understanding how the volatility of Hon Hai's stock relates to your other investments can help you create a well-diversified portfolio of assets with varying levels of risk.
Hon Hai Investment Opportunity
Hon Hai Precision has a volatility of 1.98 and is 2.68 times more volatile than Dow Jones Industrial. Compared to the overall equity markets, volatility of historical daily returns of Hon Hai Precision is lower than 17 percent of all global equities and portfolios over the last 90 days. You can use Hon Hai Precision to enhance the returns of your portfolios. The stock experiences a large bullish trend. Check odds of Hon Hai to be traded at 13.29 in 90 days.Significant diversification
The correlation between Hon Hai Precision and DJI is 0.06 (i.e., Significant diversification) for selected investment horizon. Overlapping area represents the amount of risk that can be diversified away by holding Hon Hai Precision and DJI in the same portfolio, assuming nothing else is changed.
Hon Hai Additional Risk Indicators
The analysis of Hon Hai's secondary risk indicators is one of the essential steps in making a buy or sell decision. The process involves identifying the amount of risk involved in Hon Hai's investment and either accepting that risk or mitigating it. Along with some common measures of Hon Hai stock's risk such as standard deviation, beta, or value at risk, we also provide a set of secondary indicators that can assist in the individual investment decision or help in hedging the risk of your existing portfolios.
| Risk Adjusted Performance | 0.0404 | |||
| Market Risk Adjusted Performance | 0.5007 | |||
| Mean Deviation | 1.59 | |||
| Semi Deviation | 1.91 | |||
| Downside Deviation | 1.99 | |||
| Coefficient Of Variation | 2230.85 | |||
| Standard Deviation | 1.97 |
Please note, the risk measures we provide can be used independently or collectively to perform a risk assessment. When comparing two potential stocks, we recommend comparing similar stocks with homogenous growth potential and valuation from related markets to determine which investment holds the most risk.
Hon Hai Suggested Diversification Pairs
Pair trading is one of the very effective strategies used by professional day traders and hedge funds capitalizing on short-time and mid-term market inefficiencies. The approach is based on the fact that the ratio of prices of two correlating shares is long-term stable and oscillates around the average value. If the correlation ratio comes outside the common area, you can speculate with a high success rate that the ratio will return to the mean value and collect a profit.
The effect of pair diversification on risk is to reduce it, but we should note this doesn't apply to all risk types. When we trade pairs against Hon Hai as a counterpart, there is always some inherent risk that will never be diversified away no matter what. This volatility limits the effect of tactical diversification using pair trading. Hon Hai's systematic risk is the inherent uncertainty of the entire market, and therefore cannot be mitigated even by pair-trading it against the equity that is not highly correlated to it. On the other hand, Hon Hai's unsystematic risk describes the types of risk that we can protect against, at least to some degree, by selecting a matching pair that is not perfectly correlated to Hon Hai Precision.
Additional Tools for Hon Stock Analysis
When running Hon Hai's price analysis, check to measure Hon Hai's market volatility, profitability, liquidity, solvency, efficiency, growth potential, financial leverage, and other vital indicators. We have many different tools that can be utilized to determine how healthy Hon Hai is operating at the current time. Most of Hon Hai's value examination focuses on studying past and present price action to predict the probability of Hon Hai's future price movements. You can analyze the entity against its peers and the financial market as a whole to determine factors that move Hon Hai's price. Additionally, you may evaluate how the addition of Hon Hai to your portfolios can decrease your overall portfolio volatility.