Correlation Between Hodges Small and Hodges Small

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

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

Diversification Opportunities for Hodges Small and Hodges Small

1.0

Correlation Coefficient

Hodges Small  Hodges Small

No risk reduction

The 3 months correlation between Hodges and Hodges is 1.0. Overlapping area represents the amount of risk that can be diversified away by holding Hodges Small Cap and Hodges Small Cap in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Hodges Small Cap and Hodges Small 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 Hodges Small Cap are associated (or correlated) with Hodges Small. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Hodges Small Cap has no effect on the direction of Hodges Small i.e., Hodges Small and Hodges Small go up and down completely randomly.

Pair Corralation between Hodges Small and Hodges Small

Assuming the 90 days horizon Hodges Small Cap is expected to generate 1.01 times more return on investment than Hodges Small. However, Hodges Small is 1.01 times more volatile than Hodges Small Cap. It trades about 0.1 of its potential returns per unit of risk. Hodges Small Cap is currently generating about 0.1 per unit of risk. If you would invest  1,975  in Hodges Small Cap on May 4, 2025 and sell it today you would earn a total of  165.00  from holding Hodges Small Cap or generate 8.35% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Together
Strength	Very Strong
Accuracy	98.41%
Values	Daily Returns

Hodges Small Cap  vs.  Hodges Small Cap

Hodges Small Cap

Risk-Adjusted Performance

OK

Compared to the overall equity markets, risk-adjusted returns on investments in Hodges Small Cap are ranked lower than 8 (%) of all funds and portfolios of funds over the last 90 days. In spite of fairly weak forward indicators, Hodges Small may actually be approaching a critical reversion point that can send shares even higher in September 2025.

Hodges Small Cap

Risk-Adjusted Performance

OK

Compared to the overall equity markets, risk-adjusted returns on investments in Hodges Small Cap are ranked lower than 8 (%) of all funds and portfolios of funds over the last 90 days. In spite of fairly weak basic indicators, Hodges Small may actually be approaching a critical reversion point that can send shares even higher in September 2025.

Pair Trading with Hodges Small and Hodges Small

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

The idea behind Hodges Small Cap and Hodges Small Cap 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 Funds Screener module to find actively-traded funds from around the world traded on over 30 global exchanges.