Correlation Between Hafnia and Village Super

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

By analyzing existing cross correlation between Hafnia Limited and Village Super Market, you can compare the effects of market volatilities on Hafnia and Village Super 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 Hafnia with a short position of Village Super. Check out your portfolio center. Please also check ongoing floating volatility patterns of Hafnia and Village Super.

Diversification Opportunities for Hafnia and Village Super

-0.18

Correlation Coefficient

Hafnia  Village Super

Good diversification

The 3 months correlation between Hafnia and Village is -0.18. Overlapping area represents the amount of risk that can be diversified away by holding Hafnia Limited and Village Super Market in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Village Super Market and Hafnia 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 Hafnia Limited are associated (or correlated) with Village Super. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Village Super Market has no effect on the direction of Hafnia i.e., Hafnia and Village Super go up and down completely randomly.

Pair Corralation between Hafnia and Village Super

Given the investment horizon of 90 days Hafnia Limited is expected to generate 1.36 times more return on investment than Village Super. However, Hafnia is 1.36 times more volatile than Village Super Market. It trades about 0.13 of its potential returns per unit of risk. Village Super Market is currently generating about -0.06 per unit of risk. If you would invest  491.00  in Hafnia Limited on May 7, 2025 and sell it today you would earn a total of  73.00  from holding Hafnia Limited or generate 14.87% return on investment over 90 days.

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

Hafnia Limited  vs.  Village Super Market

Hafnia Limited

Risk-Adjusted Performance

OK

Compared to the overall equity markets, risk-adjusted returns on investments in Hafnia Limited are ranked lower than 9 (%) of all global equities and portfolios over the last 90 days. In spite of very fragile technical and fundamental indicators, Hafnia displayed solid returns over the last few months and may actually be approaching a breakup point.

Village Super Market

Risk-Adjusted Performance

Very Weak

Over the last 90 days Village Super Market has generated negative risk-adjusted returns adding no value to investors with long positions. Despite somewhat strong technical and fundamental indicators, Village Super is not utilizing all of its potentials. The latest stock price disturbance, may contribute to short-term losses for the investors.

Pair Trading with Hafnia and Village Super

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

The idea behind Hafnia Limited and Village Super Market 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 Money Managers module to screen money managers from public funds and ETFs managed around the world.