Correlation Between Harn Engineering and Autocorp Holding

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

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

Diversification Opportunities for Harn Engineering and Autocorp Holding

0.0

Correlation Coefficient

Harn Engineering  Autocorp Holding

Pay attention - limited upside

The 3 months correlation between Harn and Autocorp is 0.0. Overlapping area represents the amount of risk that can be diversified away by holding Harn Engineering Solutions and Autocorp Holding Public in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Autocorp Holding Public and Harn Engineering 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 Harn Engineering Solutions are associated (or correlated) with Autocorp Holding. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Autocorp Holding Public has no effect on the direction of Harn Engineering i.e., Harn Engineering and Autocorp Holding go up and down completely randomly.

Pair Corralation between Harn Engineering and Autocorp Holding

If you would invest  216.00  in Harn Engineering Solutions on February 3, 2024 and sell it today you would earn a total of  4.00  from holding Harn Engineering Solutions or generate 1.85% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Flat
Strength	Insignificant
Accuracy	0.0%
Values	Daily Returns

Harn Engineering Solutions  vs.  Autocorp Holding Public

Harn Engineering Sol

Risk-Adjusted Performance

10 of 100

OK

Compared to the overall equity markets, risk-adjusted returns on investments in Harn Engineering Solutions are ranked lower than 10 (%) of all global equities and portfolios over the last 90 days. Despite quite weak basic indicators, Harn Engineering may actually be approaching a critical reversion point that can send shares even higher in June 2024.

Autocorp Holding Public

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Autocorp Holding Public has generated negative risk-adjusted returns adding no value to investors with long positions. Despite weak performance in the last few months, the Stock's technical and fundamental indicators remain quite persistent which may send shares a bit higher in June 2024. The latest mess may also be a sign of long-standing up-swing for the company institutional investors.

Pair Trading with Harn Engineering and Autocorp Holding

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

The idea behind Harn Engineering Solutions and Autocorp Holding Public 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 Options Analysis module to analyze and evaluate options and option chains as a potential hedge for your portfolios.