Correlation Between Superior Uniform and H M

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

By analyzing existing cross correlation between Superior Uniform Group and H M Hennes, you can compare the effects of market volatilities on Superior Uniform and H M 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 Superior Uniform with a short position of H M. Check out your portfolio center. Please also check ongoing floating volatility patterns of Superior Uniform and H M.

Diversification Opportunities for Superior Uniform and H M

0.11

Correlation Coefficient

Superior Uniform  H M

Average diversification

The 3 months correlation between Superior and HMRZF is 0.11. Overlapping area represents the amount of risk that can be diversified away by holding Superior Uniform Group and H M Hennes in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on H M Hennes and Superior Uniform 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 Superior Uniform Group are associated (or correlated) with H M. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of H M Hennes has no effect on the direction of Superior Uniform i.e., Superior Uniform and H M go up and down completely randomly.

Pair Corralation between Superior Uniform and H M

Considering the 90-day investment horizon Superior Uniform is expected to generate 664.58 times less return on investment than H M. But when comparing it to its historical volatility, Superior Uniform Group is 2.42 times less risky than H M. It trades about 0.0 of its potential returns per unit of risk. H M Hennes is currently generating about 0.15 of returns per unit of risk over similar time horizon. If you would invest  1,366  in H M Hennes on January 20, 2024 and sell it today you would earn a total of  208.00  from holding H M Hennes or generate 15.23% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Together
Strength	Insignificant
Accuracy	95.45%
Values	Daily Returns

Superior Uniform Group  vs.  H M Hennes

Superior Uniform

Risk-Adjusted Performance

9 of 100

OK

Compared to the overall equity markets, risk-adjusted returns on investments in Superior Uniform Group are ranked lower than 9 (%) of all global equities and portfolios over the last 90 days. In spite of rather unsteady technical and fundamental indicators, Superior Uniform exhibited solid returns over the last few months and may actually be approaching a breakup point.

H M Hennes

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days H M Hennes has generated negative risk-adjusted returns adding no value to investors with long positions. Despite nearly stable basic indicators, H M is not utilizing all of its potentials. The latest stock price disturbance, may contribute to mid-run losses for the stockholders.

Pair Trading with Superior Uniform and H M

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

The idea behind Superior Uniform Group and H M Hennes 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 Portfolio Manager module to state of the art Portfolio Manager to monitor and improve performance of your invested capital.