Correlation Between HAL Trust and Tetragon Financial

Can any of the company-specific risk be diversified away by investing in both HAL Trust and Tetragon Financial 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 HAL Trust and Tetragon Financial into the same portfolio, which is an essential part of the fundamental portfolio management process.

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

Diversification Opportunities for HAL Trust and Tetragon Financial

-0.67

Correlation Coefficient

HAL Trust  Tetragon Financial

Excellent diversification

The 3 months correlation between HAL and Tetragon is -0.67. Overlapping area represents the amount of risk that can be diversified away by holding HAL Trust and Tetragon Financial Group in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Tetragon Financial and HAL Trust 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 HAL Trust are associated (or correlated) with Tetragon Financial. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Tetragon Financial has no effect on the direction of HAL Trust i.e., HAL Trust and Tetragon Financial go up and down completely randomly.

Pair Corralation between HAL Trust and Tetragon Financial

Assuming the 90 days trading horizon HAL Trust is expected to generate 0.57 times more return on investment than Tetragon Financial. However, HAL Trust is 1.75 times less risky than Tetragon Financial. It trades about -0.2 of its potential returns per unit of risk. Tetragon Financial Group is currently generating about -0.19 per unit of risk. If you would invest  11,660  in HAL Trust on March 29, 2024 and sell it today you would lose (360.00) from holding HAL Trust or give up 3.09% of portfolio value over 90 days.

Time Period	3 Months [change]
Direction	Moves Against
Strength	Weak
Accuracy	81.82%
Values	Daily Returns

HAL Trust  vs.  Tetragon Financial Group

HAL Trust

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days HAL Trust has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of weak performance in the last few months, the Stock's essential indicators remain comparatively stable which may send shares a bit higher in July 2024. The newest uproar may also be a sign of mid-term up-swing for the firm private investors.

Tetragon Financial

Risk-Adjusted Performance

4 of 100

Insignificant

Compared to the overall equity markets, risk-adjusted returns on investments in Tetragon Financial Group are ranked lower than 4 (%) of all global equities and portfolios over the last 90 days. In spite of comparatively stable technical and fundamental indicators, Tetragon Financial is not utilizing all of its potentials. The newest stock price uproar, may contribute to short-horizon losses for the private investors.

Pair Trading with HAL Trust and Tetragon Financial

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

The idea behind HAL Trust and Tetragon Financial Group 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 Equity Analysis module to research over 250,000 global equities including funds, stocks and ETFs to find investment opportunities.