Correlation Between Advanced Micro and Hamilton Lane

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

By analyzing existing cross correlation between Advanced Micro Devices and Hamilton Lane Private, you can compare the effects of market volatilities on Advanced Micro and Hamilton Lane 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 Advanced Micro with a short position of Hamilton Lane. Check out your portfolio center. Please also check ongoing floating volatility patterns of Advanced Micro and Hamilton Lane.

Diversification Opportunities for Advanced Micro and Hamilton Lane

0.2

Correlation Coefficient

Advanced Micro  Hamilton Lane

Modest diversification

The 3 months correlation between Advanced and Hamilton is 0.2. Overlapping area represents the amount of risk that can be diversified away by holding Advanced Micro Devices and Hamilton Lane Private in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Hamilton Lane Private and Advanced Micro 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 Advanced Micro Devices are associated (or correlated) with Hamilton Lane. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Hamilton Lane Private has no effect on the direction of Advanced Micro i.e., Advanced Micro and Hamilton Lane go up and down completely randomly.

Pair Corralation between Advanced Micro and Hamilton Lane

Considering the 90-day investment horizon Advanced Micro is expected to generate 17.36 times less return on investment than Hamilton Lane. But when comparing it to its historical volatility, Advanced Micro Devices is 2.27 times less risky than Hamilton Lane. It trades about 0.05 of its potential returns per unit of risk. Hamilton Lane Private is currently generating about 0.4 of returns per unit of risk over similar time horizon. If you would invest  1,191  in Hamilton Lane Private on January 19, 2024 and sell it today you would earn a total of  381.00  from holding Hamilton Lane Private or generate 31.99% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Together
Strength	Very Weak
Accuracy	2.02%
Values	Daily Returns

Advanced Micro Devices  vs.  Hamilton Lane Private

Advanced Micro Devices

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Advanced Micro Devices has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of latest unfluctuating performance, the Stock's primary indicators remain sound and the latest tumult on Wall Street may also be a sign of longer-term gains for the firm shareholders.

Hamilton Lane Private

Risk-Adjusted Performance

0 of 100

Excellent

Over the last 90 days Hamilton Lane Private has generated negative risk-adjusted returns adding no value to fund investors. In spite of fairly weak forward indicators, Hamilton Lane showed solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with Advanced Micro and Hamilton Lane

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

The idea behind Advanced Micro Devices and Hamilton Lane Private 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 Commodity Directory module to find actively traded commodities issued by global exchanges.