Correlation Between Innovative Solutions and Hess

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

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

Diversification Opportunities for Innovative Solutions and Hess

0.82

Correlation Coefficient

Innovative Solutions  Hess

Very poor diversification

The 3 months correlation between Innovative and Hess is 0.82. Overlapping area represents the amount of risk that can be diversified away by holding Innovative Solutions and and Hess Corp. in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Hess and Innovative Solutions 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 Innovative Solutions and are associated (or correlated) with Hess. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Hess has no effect on the direction of Innovative Solutions i.e., Innovative Solutions and Hess go up and down completely randomly.

Pair Corralation between Innovative Solutions and Hess

Given the investment horizon of 90 days Innovative Solutions and is expected to generate 3.99 times more return on investment than Hess. However, Innovative Solutions is 3.99 times more volatile than Hess Corporation. It trades about 0.27 of its potential returns per unit of risk. Hess Corporation is currently generating about 0.22 per unit of risk. If you would invest  688.00  in Innovative Solutions and on May 4, 2025 and sell it today you would earn a total of  863.00  from holding Innovative Solutions and or generate 125.44% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Together
Strength	Strong
Accuracy	84.13%
Values	Daily Returns

Innovative Solutions and  vs.  Hess Corp.

Innovative Solutions and

Risk-Adjusted Performance

Solid

Compared to the overall equity markets, risk-adjusted returns on investments in Innovative Solutions and are ranked lower than 21 (%) of all global equities and portfolios over the last 90 days. In spite of rather unfluctuating basic indicators, Innovative Solutions exhibited solid returns over the last few months and may actually be approaching a breakup point.

Hess

Risk-Adjusted Performance

Solid

Over the last 90 days Hess Corporation has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of comparatively fragile technical and fundamental indicators, Hess unveiled solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with Innovative Solutions and Hess

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

The idea behind Innovative Solutions and and Hess Corporation 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 Premium Stories module to follow Macroaxis premium stories from verified contributors across different equity types, categories and coverage scope.