Correlation Between Costco Wholesale and HITHINK ROYALFLUSH

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Can any of the company-specific risk be diversified away by investing in both Costco Wholesale and HITHINK ROYALFLUSH 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 Costco Wholesale and HITHINK ROYALFLUSH into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Costco Wholesale and HITHINK ROYALFLUSH, you can compare the effects of market volatilities on Costco Wholesale and HITHINK ROYALFLUSH 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 Costco Wholesale with a short position of HITHINK ROYALFLUSH. Check out your portfolio center. Please also check ongoing floating volatility patterns of Costco Wholesale and HITHINK ROYALFLUSH.

Diversification Opportunities for Costco Wholesale and HITHINK ROYALFLUSH

-0.21
  Correlation Coefficient

Very good diversification

The 3 months correlation between Costco and HITHINK is -0.21. Overlapping area represents the amount of risk that can be diversified away by holding Costco Wholesale and HITHINK ROYALFLUSH in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on HITHINK ROYALFLUSH and Costco Wholesale 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 Costco Wholesale are associated (or correlated) with HITHINK ROYALFLUSH. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of HITHINK ROYALFLUSH has no effect on the direction of Costco Wholesale i.e., Costco Wholesale and HITHINK ROYALFLUSH go up and down completely randomly.

Pair Corralation between Costco Wholesale and HITHINK ROYALFLUSH

Given the investment horizon of 90 days Costco Wholesale is expected to generate 0.47 times more return on investment than HITHINK ROYALFLUSH. However, Costco Wholesale is 2.11 times less risky than HITHINK ROYALFLUSH. It trades about 0.05 of its potential returns per unit of risk. HITHINK ROYALFLUSH is currently generating about -0.04 per unit of risk. If you would invest  34,444  in Costco Wholesale on June 27, 2022 and sell it today you would earn a total of  12,196  from holding Costco Wholesale or generate 35.41% return on investment over 90 days.
Time Period3 Months [change]
DirectionMoves Against 
StrengthInsignificant
Accuracy78.36%
ValuesDaily Returns

Costco Wholesale  vs.  HITHINK ROYALFLUSH

 Performance (%) 
       Timeline  
Costco Wholesale 
Costco Performance
0 of 100
Over the last 90 days Costco Wholesale has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of comparatively stable basic indicators, Costco Wholesale is not utilizing all of its potentials. The latest stock price uproar, may contribute to short-horizon losses for the private investors.

Costco Price Channel

HITHINK ROYALFLUSH 
HITHINK Performance
0 of 100
Over the last 90 days HITHINK ROYALFLUSH has generated negative risk-adjusted returns adding no value to investors with long positions. Despite weak performance in the last few months, the Stock's basic indicators remain somewhat strong which may send shares a bit higher in October 2022. The current disturbance may also be a sign of long term up-swing for the company investors.

HITHINK Price Channel

Costco Wholesale and HITHINK ROYALFLUSH Volatility Contrast

   Predicted Return Density   
       Returns  

Pair Trading with Costco Wholesale and HITHINK ROYALFLUSH

The main advantage of trading using opposite Costco Wholesale and HITHINK ROYALFLUSH positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Costco Wholesale position performs unexpectedly, HITHINK ROYALFLUSH 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 HITHINK ROYALFLUSH will offset losses from the drop in HITHINK ROYALFLUSH's long position.
Costco Wholesale vs. BUSHVELD MINERALS LTD
The idea behind Costco Wholesale and HITHINK ROYALFLUSH 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.
HITHINK ROYALFLUSH vs. SHENZHEN FORTUNE TREND
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 Idea Breakdown module to analyze constituents of all Macroaxis ideas. Macroaxis investment ideas are predefined, sector-focused investing themes.

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