Hydrofarm Holdings Groupinc Stock Volatility
| HYFM Stock | USD 0.89 0.02 2.20% |
Hydrofarm Holdings holds Efficiency (Sharpe) Ratio of -0.0238, which attests that the entity had a -0.0238% return per unit of risk over the last 3 months. Hydrofarm Holdings exposes twenty-nine different technical indicators, which can help you to evaluate volatility embedded in its price movement. Please check out Hydrofarm Holdings' Risk Adjusted Performance of 0.0164, downside deviation of 3.78, and Market Risk Adjusted Performance of 0.0335 to validate the risk estimate we provide. Key indicators related to Hydrofarm Holdings' volatility include:
180 Days Market Risk | Chance Of Distress | 180 Days Economic Sensitivity |
Hydrofarm Holdings Stock volatility depicts how high the prices fluctuate around the mean (or its average) price. In other words, it is a statistical measure of the distribution of Hydrofarm daily returns, and it is calculated using variance and standard deviation. We also use Hydrofarm's beta, its sensitivity to the market, as well as its odds of financial distress to provide a more practical estimation of Hydrofarm Holdings volatility.
Hydrofarm |
Since volatility provides investors with entry points to take advantage of stock prices, companies, such as Hydrofarm Holdings can benefit from it. Downward market volatility can be a perfect environment for investors who play the long game. Here, they may decide to buy additional stocks of Hydrofarm Holdings at lower prices. For example, an investor can purchase Hydrofarm stock that has halved in price over a short period. This will lower your average cost per share, thereby improving your portfolio's performance when the markets normalize. Similarly, when the prices of Hydrofarm Holdings' stock rises, investors can sell out and invest the proceeds in other equities with better opportunities. Investing when markets are volatile with better valuations will accord both investors and companies the opportunity to generate better long-term returns.
Moving together with Hydrofarm Stock
| 0.64 | DE | Deere Company Financial Report 17th of May 2024 | PairCorr |
| 0.68 | ALG | Alamo Group Earnings Call This Week | PairCorr |
Moving against Hydrofarm Stock
| 0.49 | XOS | Xos Inc Financial Report 8th of May 2024 | PairCorr |
Hydrofarm Holdings Market Sensitivity And Downside Risk
Hydrofarm Holdings' beta coefficient measures the volatility of Hydrofarm stock compared to the systematic risk of the entire market represented by your selected benchmark. In mathematical terms, beta represents the slope of the line through a regression of data points where each of these points represents Hydrofarm stock's returns against your selected market. In other words, Hydrofarm Holdings's beta of 1.83 provides an investor with an approximation of how much risk Hydrofarm Holdings stock can potentially add to one of your existing portfolios. Hydrofarm Holdings GroupInc shows above-average downside volatility for the selected time horizon. Hydrofarm Holdings GroupInc is a potential penny stock. Although Hydrofarm Holdings may be in fact a good instrument to invest, many penny stocks are speculative in nature and are subject to artificial price hype. Please make sure you totally understand the upside potential and downside risk of investing in Hydrofarm Holdings GroupInc. We encourage investors to look for signals such as email spams, message board hypes, claims of breakthroughs, volume upswings, sudden news releases, promotions that are not reported, or demotions released before SEC filings. Please also check biographies and work history of current and past company officers before investing in high volatility instruments, penny stocks, or equities with microcap classification. You can indeed make money on Hydrofarm instrument if you perfectly time your entry and exit. However, remember that penny stocks that have been the subject of artificial hype usually unable to maintain their increased share price for more than just a few days. The price of a promoted high volatility instrument will almost always revert back. The only way to increase shareholder value is through legitimate performance backed up by solid fundamentals.
3 Months Beta |Analyze Hydrofarm Holdings Demand TrendCheck current 90 days Hydrofarm Holdings correlation with market (NYSE Composite)Hydrofarm Beta |
Hydrofarm standard deviation measures the daily dispersion of prices over your selected time horizon relative to its mean. A typical volatile entity has a high standard deviation, while the deviation of a stable instrument is usually low. As a downside, the standard deviation calculates all uncertainty as risk, even when it is in your favor, such as above-average returns.
Standard Deviation | 4.25 |
It is essential to understand the difference between upside risk (as represented by Hydrofarm Holdings's standard deviation) and the downside risk, which can be measured by semi-deviation or downside deviation of Hydrofarm Holdings' daily returns or price. Since the actual investment returns on holding a position in hydrofarm stock tend to have a non-normal distribution, there will be different probabilities for losses than for gains. The likelihood of losses is reflected in the downside risk of an investment in Hydrofarm Holdings.
Using Hydrofarm Put Option to Manage Risk
Put options written on Hydrofarm Holdings grant holders of the option the right to sell a specified amount of Hydrofarm Holdings at a specified price within a specified time frame. The put buyer has a limited loss and, while not fully unlimited gains, as the price of Hydrofarm Stock cannot fall below zero, the put buyer does gain as the price drops. So, one way investors can hedge Hydrofarm Holdings' position is by buying a put option against it. The put option used this way is usually referred to as insurance. If an undesired outcome occurs and loss on holding Hydrofarm Holdings will be realized, the loss incurred will be offset by the profits made with the option trade.
Hydrofarm Holdings' PUT expiring on 2024-05-17
Profit |
| Hydrofarm Holdings Price At Expiration |
Current Hydrofarm Holdings Insurance Chain
| Delta | Gamma | Open Int | Expiration | Current Spread | Last Price | |||
Put | 2024-05-17 PUT at $1.0 | -0.5854 | 1.6237 | 15 | 2024-05-17 | 0.1 - 0.2 | 0.15 | View |
Hydrofarm Holdings Stock Volatility Analysis
Volatility refers to the frequency at which Hydrofarm Holdings stock price increases or decreases within a specified period. These fluctuations usually indicate the level of risk that's associated with Hydrofarm Holdings' price changes. Investors will then calculate the volatility of Hydrofarm Holdings' stock to predict their future moves. A stock that has erratic price changes quickly hits new highs, and lows are considered highly volatile. A stock with relatively stable price changes has low volatility. A highly volatile stock is riskier, but the risk cuts both ways. Investing in highly volatile security can either be highly successful, or you may experience significant failure. There are two main types of Hydrofarm Holdings' volatility:
Historical Volatility
This type of stock volatility measures Hydrofarm Holdings' fluctuations based on previous trends. It's commonly used to predict Hydrofarm Holdings' future behavior based on its past. However, it cannot conclusively determine the future direction of the stock.Implied Volatility
This type of volatility provides a positive outlook on future price fluctuations for Hydrofarm Holdings' current market price. This means that the stock will return to its initially predicted market price. This type of volatility can be derived from derivative instruments written on Hydrofarm Holdings' to be redeemed at a future date.Transformation |
The output start index for this execution was zero with a total number of output elements of sixty-one. Hydrofarm Holdings Average Price is the average of the sum of open, high, low and close daily prices of a bar. It can be used to smooth an indicator that normally takes just the closing price as input.
Hydrofarm Holdings Projected Return Density Against Market
Given the investment horizon of 90 days the stock has the beta coefficient of 1.8329 . This usually indicates as the benchmark fluctuates upward, the company is expected to outperform it on average. However, if the benchmark returns are projected to be negative, Hydrofarm Holdings will likely underperform.Most traded equities are subject to two types of risk - systematic (i.e., market) and unsystematic (i.e., nonmarket or company-specific) risk. Unsystematic risk is the risk that events specific to Hydrofarm Holdings or Machinery sector will adversely affect the stock's price. This type of risk can be diversified away by owning several different stocks in different industries whose stock prices have shown a small correlation to each other. On the other hand, systematic risk is the risk that Hydrofarm Holdings' price will be affected by overall stock market movements and cannot be diversified away. So, no matter how many positions you have, you cannot eliminate market risk. However, you can measure a Hydrofarm stock's historical response to market movements and buy it if you are comfortable with its volatility direction. Beta and standard deviation are two commonly used measures to help you make the right decision.
Hydrofarm Holdings GroupInc has a negative alpha, implying that the risk taken by holding this instrument is not justified. The company is significantly underperforming the NYSE Composite. Predicted Return Density |
| Returns |
What Drives a Hydrofarm Holdings Price Volatility?
Several factors can influence a stock's market volatility:Industry
Specific events can influence volatility within a particular industry. For instance, a significant weather upheaval in a crucial oil-production site may cause oil prices to increase in the oil sector. The direct result will be the rise in the stock price of oil distribution companies. Similarly, any government regulation in a specific industry could negatively influence stock prices due to increased regulations on compliance that may impact the company's future earnings and growth.Political and Economic environment
When governments make significant decisions regarding trade agreements, policies, and legislation regarding specific industries, they will influence stock prices. Everything from speeches to elections may influence investors, who can directly influence the stock prices in any particular industry. The prevailing economic situation also plays a significant role in stock prices. When the economy is doing well, investors will have a positive reaction and hence, better stock prices and vice versa.The Company's Performance
Sometimes volatility will only affect an individual company. For example, a revolutionary product launch or strong earnings report may attract many investors to purchase the company. This positive attention will raise the company's stock price. In contrast, product recalls and data breaches may negatively influence a company's stock prices.Hydrofarm Holdings Stock Risk Measures
Given the investment horizon of 90 days the coefficient of variation of Hydrofarm Holdings is -4204.19. The daily returns are distributed with a variance of 18.06 and standard deviation of 4.25. The mean deviation of Hydrofarm Holdings GroupInc is currently at 3.0. For similar time horizon, the selected benchmark (NYSE Composite) has volatility of 0.62
α | Alpha over NYSE Composite | -0.11 | |
β | Beta against NYSE Composite | 1.83 | |
σ | Overall volatility | 4.25 | |
Ir | Information ratio | -0.01 |
Hydrofarm Holdings Stock Return Volatility
Hydrofarm Holdings historical daily return volatility represents how much of Hydrofarm Holdings stock's daily returns swing around its mean - it is a statistical measure of its dispersion of returns. The firm inherits 4.25% risk (volatility on return distribution) over the 90 days horizon. By contrast, NYSE Composite accepts 0.6372% volatility on return distribution over the 90 days horizon. Performance |
| Timeline |
About Hydrofarm Holdings Volatility
Volatility is a rate at which the price of Hydrofarm Holdings or any other equity instrument increases or decreases for a given set of returns. It is measured by calculating the standard deviation of the annualized returns over a given period of time and shows the range to which the price of Hydrofarm Holdings may increase or decrease. In other words, similar to Hydrofarm's beta indicator, it measures the risk of Hydrofarm Holdings and helps estimate the fluctuations that may happen in a short period of time. So if prices of Hydrofarm Holdings fluctuate rapidly in a short time span, it is termed to have high volatility, and if it swings slowly in a more extended period, it is understood to have low volatility.
Please read more on our technical analysis page.| Last Reported | Projected for Next Year | ||
| Market Cap | 41.8 M | 39.7 M |
Hydrofarm Holdings' stock volatility refers to the amount of uncertainty or risk involved with the size of changes in its stock's price. It is a statistical measure of the dispersion of returns on Hydrofarm Stock over a specified period of time, often expressed as the standard deviation of daily returns. In other words, it measures how much Hydrofarm Holdings' price varies over time.
3 ways to utilize Hydrofarm Holdings' volatility to invest better
Higher Hydrofarm Holdings' stock volatility means that the price of its stock is changing rapidly and unpredictably, while lower stock volatility indicates that the price of Hydrofarm Holdings stock is relatively stable. Investors and traders use stock volatility as an indicator of risk and potential reward, as stocks with higher volatility can offer the potential for more significant returns but also come with a greater risk of losses. Hydrofarm Holdings stock volatility can provide helpful information for making investment decisions in the following ways:- Measuring Risk: Volatility can be used as a measure of risk, which can help you determine the potential fluctuations in the value of Hydrofarm Holdings investment. A higher volatility means higher risk and potentially larger changes in value.
- Identifying Opportunities: High volatility in Hydrofarm Holdings' stock can indicate that there is potential for significant price movements, either up or down, which could present investment opportunities.
- Diversification: Understanding how the volatility of Hydrofarm Holdings' stock relates to your other investments can help you create a well-diversified portfolio of assets with varying levels of risk.
Hydrofarm Holdings Investment Opportunity
Hydrofarm Holdings GroupInc has a volatility of 4.25 and is 6.64 times more volatile than NYSE Composite. Compared to the overall equity markets, volatility of historical daily returns of Hydrofarm Holdings GroupInc is lower than 37 percent of all global equities and portfolios over the last 90 days. You can use Hydrofarm Holdings GroupInc to protect your portfolios against small market fluctuations. The stock experiences an unexpected downward movement. The market is reacting to new fundamentals. Check odds of Hydrofarm Holdings to be traded at $0.8544 in 90 days.Modest diversification
The correlation between Hydrofarm Holdings GroupInc and NYA is 0.27 (i.e., Modest diversification) for selected investment horizon. Overlapping area represents the amount of risk that can be diversified away by holding Hydrofarm Holdings GroupInc and NYA in the same portfolio, assuming nothing else is changed.
Hydrofarm Holdings Additional Risk Indicators
The analysis of Hydrofarm Holdings' secondary risk indicators is one of the essential steps in making a buy or sell decision. The process involves identifying the amount of risk involved in Hydrofarm Holdings' investment and either accepting that risk or mitigating it. Along with some common measures of Hydrofarm Holdings stock's risk such as standard deviation, beta, or value at risk, we also provide a set of secondary indicators that can assist in the individual investment decision or help in hedging the risk of your existing portfolios.
| Risk Adjusted Performance | 0.0164 | |||
| Market Risk Adjusted Performance | 0.0335 | |||
| Mean Deviation | 3.01 | |||
| Semi Deviation | 3.37 | |||
| Downside Deviation | 3.78 | |||
| Coefficient Of Variation | 7969.61 | |||
| Standard Deviation | 4.23 |
Please note, the risk measures we provide can be used independently or collectively to perform a risk assessment. When comparing two potential stocks, we recommend comparing similar stocks with homogenous growth potential and valuation from related markets to determine which investment holds the most risk.
Hydrofarm Holdings Suggested Diversification Pairs
Pair trading is one of the very effective strategies used by professional day traders and hedge funds capitalizing on short-time and mid-term market inefficiencies. The approach is based on the fact that the ratio of prices of two correlating shares is long-term stable and oscillates around the average value. If the correlation ratio comes outside the common area, you can speculate with a high success rate that the ratio will return to the mean value and collect a profit.
The effect of pair diversification on risk is to reduce it, but we should note this doesn't apply to all risk types. When we trade pairs against Hydrofarm Holdings as a counterpart, there is always some inherent risk that will never be diversified away no matter what. This volatility limits the effect of tactical diversification using pair trading. Hydrofarm Holdings' systematic risk is the inherent uncertainty of the entire market, and therefore cannot be mitigated even by pair-trading it against the equity that is not highly correlated to it. On the other hand, Hydrofarm Holdings' unsystematic risk describes the types of risk that we can protect against, at least to some degree, by selecting a matching pair that is not perfectly correlated to Hydrofarm Holdings GroupInc.
When determining whether Hydrofarm Holdings is a strong investment it is important to analyze Hydrofarm Holdings' competitive position within its industry, examining market share, product or service uniqueness, and competitive advantages. Beyond financials and market position, potential investors should also consider broader economic conditions, industry trends, and any regulatory or geopolitical factors that may impact Hydrofarm Holdings' future performance. For an informed investment choice regarding Hydrofarm Stock, refer to the following important reports: Check out Risk vs Return Analysis to better understand how to build diversified portfolios, which includes a position in Hydrofarm Holdings GroupInc. Also, note that the market value of any company could be tightly coupled with the direction of predictive economic indicators such as signals in census. Note that the Hydrofarm Holdings information on this page should be used as a complementary analysis to other Hydrofarm Holdings' statistical models used 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 Earnings Calls module to check upcoming earnings announcements updated hourly across public exchanges.
Complementary Tools for Hydrofarm Stock analysis
When running Hydrofarm Holdings' price analysis, check to measure Hydrofarm Holdings' market volatility, profitability, liquidity, solvency, efficiency, growth potential, financial leverage, and other vital indicators. We have many different tools that can be utilized to determine how healthy Hydrofarm Holdings is operating at the current time. Most of Hydrofarm Holdings' value examination focuses on studying past and present price action to predict the probability of Hydrofarm Holdings' future price movements. You can analyze the entity against its peers and the financial market as a whole to determine factors that move Hydrofarm Holdings' price. Additionally, you may evaluate how the addition of Hydrofarm Holdings to your portfolios can decrease your overall portfolio volatility.
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Is Hydrofarm Holdings' industry expected to grow? Or is there an opportunity to expand the business' product line in the future? Factors like these will boost the valuation of Hydrofarm Holdings. If investors know Hydrofarm will grow in the future, the company's valuation will be higher. The financial industry is built on trying to define current growth potential and future valuation accurately. All the valuation information about Hydrofarm Holdings listed above have to be considered, but the key to understanding future value is determining which factors weigh more heavily than others.
Quarterly Earnings Growth 3.625 | Earnings Share (1.42) | Revenue Per Share 4.979 | Quarterly Revenue Growth (0.23) | Return On Assets (0.04) |
The market value of Hydrofarm Holdings is measured differently than its book value, which is the value of Hydrofarm that is recorded on the company's balance sheet. Investors also form their own opinion of Hydrofarm Holdings' value that differs from its market value or its book value, called intrinsic value, which is Hydrofarm Holdings' true underlying value. Investors use various methods to calculate intrinsic value and buy a stock when its market value falls below its intrinsic value. Because Hydrofarm Holdings' market value can be influenced by many factors that don't directly affect Hydrofarm Holdings' underlying business (such as a pandemic or basic market pessimism), market value can vary widely from intrinsic value.
Please note, there is a significant difference between Hydrofarm Holdings' value and its price as these two are different measures arrived at by different means. Investors typically determine if Hydrofarm Holdings is a good investment by looking at such factors as earnings, sales, fundamental and technical indicators, competition as well as analyst projections. However, Hydrofarm Holdings' price is the amount at which it trades on the open market and represents the number that a seller and buyer find agreeable to each party.