Correlation Between HeartCore Enterprises and Research Frontiers

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

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

Diversification Opportunities for HeartCore Enterprises and Research Frontiers

0.05

Correlation Coefficient

HeartCore Enterprises  Research Frontiers

Significant diversification

The 3 months correlation between HeartCore and Research is 0.05. Overlapping area represents the amount of risk that can be diversified away by holding HeartCore Enterprises and Research Frontiers Incorporate in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Research Frontiers and HeartCore Enterprises 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 HeartCore Enterprises are associated (or correlated) with Research Frontiers. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Research Frontiers has no effect on the direction of HeartCore Enterprises i.e., HeartCore Enterprises and Research Frontiers go up and down completely randomly.

Pair Corralation between HeartCore Enterprises and Research Frontiers

Given the investment horizon of 90 days HeartCore Enterprises is expected to generate 12.08 times less return on investment than Research Frontiers. In addition to that, HeartCore Enterprises is 1.16 times more volatile than Research Frontiers Incorporated. It trades about 0.01 of its total potential returns per unit of risk. Research Frontiers Incorporated is currently generating about 0.12 per unit of volatility. If you would invest  116.00  in Research Frontiers Incorporated on May 5, 2025 and sell it today you would earn a total of  44.00  from holding Research Frontiers Incorporated or generate 37.93% return on investment over 90 days.

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

HeartCore Enterprises  vs.  Research Frontiers Incorporate

HeartCore Enterprises

Risk-Adjusted Performance

Very Weak

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

Research Frontiers

Risk-Adjusted Performance

OK

Compared to the overall equity markets, risk-adjusted returns on investments in Research Frontiers Incorporated are ranked lower than 9 (%) of all global equities and portfolios over the last 90 days. Even with relatively conflicting technical and fundamental indicators, Research Frontiers reported solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with HeartCore Enterprises and Research Frontiers

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

The idea behind HeartCore Enterprises and Research Frontiers Incorporated 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 Bonds Directory module to find actively traded corporate debentures issued by US companies.