Correlation Between Hudson Global and Korn Ferry

Can any of the company-specific risk be diversified away by investing in both Hudson Global and Korn Ferry 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 Hudson Global and Korn Ferry into the same portfolio, which is an essential part of the fundamental portfolio management process.

By analyzing existing cross correlation between Hudson Global and Korn Ferry, you can compare the effects of market volatilities on Hudson Global and Korn Ferry 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 Hudson Global with a short position of Korn Ferry. Check out your portfolio center. Please also check ongoing floating volatility patterns of Hudson Global and Korn Ferry.

Diversification Opportunities for Hudson Global and Korn Ferry

0.32

Correlation Coefficient

Hudson Global  Korn Ferry

Weak diversification

The 3 months correlation between Hudson and Korn is 0.32. Overlapping area represents the amount of risk that can be diversified away by holding Hudson Global and Korn Ferry in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Korn Ferry and Hudson Global 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 Hudson Global are associated (or correlated) with Korn Ferry. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Korn Ferry has no effect on the direction of Hudson Global i.e., Hudson Global and Korn Ferry go up and down completely randomly.

Pair Corralation between Hudson Global and Korn Ferry

Given the investment horizon of 90 days Hudson Global is expected to under-perform the Korn Ferry. In addition to that, Hudson Global is 1.82 times more volatile than Korn Ferry. It trades about -0.11 of its total potential returns per unit of risk. Korn Ferry is currently generating about 0.22 per unit of volatility. If you would invest  6,084  in Korn Ferry on February 14, 2024 and sell it today you would earn a total of  379.00  from holding Korn Ferry or generate 6.23% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Together
Strength	Very Weak
Accuracy	100.0%
Values	Daily Returns

Hudson Global  vs.  Korn Ferry

Hudson Global

Risk-Adjusted Performance

6 of 100

Modest

Compared to the overall equity markets, risk-adjusted returns on investments in Hudson Global are ranked lower than 6 (%) of all global equities and portfolios over the last 90 days. In spite of very inconsistent basic indicators, Hudson Global displayed solid returns over the last few months and may actually be approaching a breakup point.

Korn Ferry

Risk-Adjusted Performance

8 of 100

OK

Compared to the overall equity markets, risk-adjusted returns on investments in Korn Ferry are ranked lower than 8 (%) of all global equities and portfolios over the last 90 days. In spite of fairly inconsistent technical and fundamental indicators, Korn Ferry may actually be approaching a critical reversion point that can send shares even higher in June 2024.

Pair Trading with Hudson Global and Korn Ferry

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

The idea behind Hudson Global and Korn Ferry 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 Portfolio Diagnostics module to use generated alerts and portfolio events aggregator to diagnose current holdings.