Correlation Between Resource America and HIS
Can any of the company-specific risk be diversified away by investing in both Resource America and HIS 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 Resource America and HIS into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Resource America and HIS Co, you can compare the effects of market volatilities on Resource America and HIS 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 Resource America with a short position of HIS. Check out your portfolio center. Please also check ongoing floating volatility patterns of Resource America and HIS.
Diversification Opportunities for Resource America and HIS
0.0 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between Resource and HIS is 0.0. Overlapping area represents the amount of risk that can be diversified away by holding Resource America and HIS Co in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on HIS Co and Resource America 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 Resource America are associated (or correlated) with HIS. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of HIS Co has no effect on the direction of Resource America i.e., Resource America and HIS go up and down completely randomly.
Pair Corralation between Resource America and HIS
If you would invest (100.00) in Resource America on January 26, 2024 and sell it today you would earn a total of 100.00 from holding Resource America or generate -100.0% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Flat |
| Strength | Insignificant |
| Accuracy | 0.0% |
| Values | Daily Returns |
Resource America vs. HIS Co
Performance |
| Timeline |
| Resource America |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Very Weak
| HIS Co |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Very Weak
Resource America and HIS Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Resource America and HIS
The main advantage of trading using opposite Resource America and HIS positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Resource America position performs unexpectedly, HIS 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 HIS will offset losses from the drop in HIS's long position.| Resource America vs. Seadrill Limited | Resource America vs. Barings BDC | Resource America vs. PennantPark Floating Rate | Resource America vs. Transocean |
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 Idea Optimizer module to use advanced portfolio builder with pre-computed micro ideas to build optimal portfolio .
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