Correlation Between Interpublic Group and Haoxi Health

Can any of the company-specific risk be diversified away by investing in both Interpublic Group and Haoxi Health 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 Interpublic Group and Haoxi Health into the same portfolio, which is an essential part of the fundamental portfolio management process.

By analyzing existing cross correlation between Interpublic Group of and Haoxi Health Technology, you can compare the effects of market volatilities on Interpublic Group and Haoxi Health 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 Interpublic Group with a short position of Haoxi Health. Check out your portfolio center. Please also check ongoing floating volatility patterns of Interpublic Group and Haoxi Health.

Diversification Opportunities for Interpublic Group and Haoxi Health

0.22

Correlation Coefficient

Interpublic Group  Haoxi Health

Modest diversification

The 3 months correlation between Interpublic and Haoxi is 0.22. Overlapping area represents the amount of risk that can be diversified away by holding Interpublic Group of and Haoxi Health Technology in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Haoxi Health Technology and Interpublic Group 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 Interpublic Group of are associated (or correlated) with Haoxi Health. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Haoxi Health Technology has no effect on the direction of Interpublic Group i.e., Interpublic Group and Haoxi Health go up and down completely randomly.

Pair Corralation between Interpublic Group and Haoxi Health

Considering the 90-day investment horizon Interpublic Group of is expected to under-perform the Haoxi Health. But the stock apears to be less risky and, when comparing its historical volatility, Interpublic Group of is 8.08 times less risky than Haoxi Health. The stock trades about -0.1 of its potential returns per unit of risk. The Haoxi Health Technology is currently generating about 0.0 of returns per unit of risk over similar time horizon. If you would invest  750.00  in Haoxi Health Technology on March 13, 2024 and sell it today you would lose (150.00) from holding Haoxi Health Technology or give up 20.0% of portfolio value over 90 days.

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

Interpublic Group of  vs.  Haoxi Health Technology

Interpublic Group

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Interpublic Group of has generated negative risk-adjusted returns adding no value to investors with long positions. Despite latest conflicting performance, the Stock's basic indicators remain stable and the current disturbance on Wall Street may also be a sign of long-run gains for the company stockholders.

Haoxi Health Technology

Risk-Adjusted Performance

0 of 100

Weak

Over the last 90 days Haoxi Health Technology has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of very healthy basic indicators, Haoxi Health is not utilizing all of its potentials. The latest stock price disarray, may contribute to short-term losses for the investors.

Pair Trading with Interpublic Group and Haoxi Health

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

The idea behind Interpublic Group of and Haoxi Health Technology 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 Theme Ratings module to determine theme ratings based on digital equity recommendations. Macroaxis theme ratings are based on combination of fundamental analysis and risk-adjusted market performance.