Correlation Between Hakuhodo and Ideanomics

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Can any of the company-specific risk be diversified away by investing in both Hakuhodo and Ideanomics 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 Hakuhodo and Ideanomics into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Hakuhodo DY Holdings and Ideanomics, you can compare the effects of market volatilities on Hakuhodo and Ideanomics 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 Hakuhodo with a short position of Ideanomics. Check out your portfolio center. Please also check ongoing floating volatility patterns of Hakuhodo and Ideanomics.

Diversification Opportunities for Hakuhodo and Ideanomics

-0.85
  Correlation Coefficient

Pay attention - limited upside

The 3 months correlation between Hakuhodo and Ideanomics is -0.85. Overlapping area represents the amount of risk that can be diversified away by holding Hakuhodo DY Holdings and Ideanomics in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Ideanomics and Hakuhodo 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 Hakuhodo DY Holdings are associated (or correlated) with Ideanomics. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Ideanomics has no effect on the direction of Hakuhodo i.e., Hakuhodo and Ideanomics go up and down completely randomly.

Pair Corralation between Hakuhodo and Ideanomics

If you would invest  16.00  in Ideanomics on October 30, 2022 and sell it today you would earn a total of  5.00  from holding Ideanomics or generate 31.25% return on investment over 90 days.
Time Period3 Months [change]
DirectionMoves Against 
StrengthSignificant
Accuracy20.0%
ValuesDaily Returns

Hakuhodo DY Holdings  vs.  Ideanomics

 Performance (%) 
       Timeline  
Hakuhodo DY Holdings 
Hakuhodo Performance
0 of 100
Over the last 90 days Hakuhodo DY Holdings has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of fairly unsteady basic indicators, Hakuhodo showed solid returns over the last few months and may actually be approaching a breakup point.
Ideanomics 
Ideanomics Performance
0 of 100
Over the last 90 days Ideanomics has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of conflicting performance in the last few months, the Stock's technical and fundamental indicators remain fairly strong which may send shares a bit higher in February 2023. The current disturbance may also be a sign of long term up-swing for the company investors.

Ideanomics Price Channel

Hakuhodo and Ideanomics Volatility Contrast

   Predicted Return Density   
       Returns  

Pair Trading with Hakuhodo and Ideanomics

The main advantage of trading using opposite Hakuhodo and Ideanomics positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Hakuhodo position performs unexpectedly, Ideanomics 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 Ideanomics will offset losses from the drop in Ideanomics' long position.
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The idea behind Hakuhodo DY Holdings and Ideanomics 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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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 Companies Directory module to evaluate performance of over 100,000 Stocks, Funds, and ETFs against different fundamentals.

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