Honda Volatility

<div class='circular--portrait' style='background:#FF6600;color: #FFFAFA;font-size:3em;padding-top: 38px;;'>HMC</div>
HMC -- USA Stock  

Fiscal Quarter End: 30th of June 2020  

Macroaxis considers Honda not too volatile given 3 months investment horizon. Honda Motor holds Efficiency (Sharpe) Ratio of 0.0991, which attests that the entity had 0.0991% of return per unit of risk over the last 3 months. Our philosophy towards determining the volatility of a stock is to use all available market data together with stock specific technical indicators that cannot be diversified away. We have found twenty-eight technical indicators for Honda Motor, which you can use to evaluate future volatility of the corporation. Please utilize Honda Risk Adjusted Performance of 0.1552, Downside Deviation of 3.68 and Market Risk Adjusted Performance of 0.1854 to validate if our risk estimates are consistent with your expectations.

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Honda 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 Honda daily returns, and it is calculated using variance and standard deviation. We also use Honda's beta, its sensitivity to the market, as well as its odds of financial distress to provide a more practical estimation of Honda volatility.

  Interest Expense

90 Days Market Risk

Not too volatile

Chance of Distress

Close to Average

90 Days Economic Sensitivity

Follows market closely

Honda Market Sensitivity

As returns on market increase, Honda returns are expected to increase less than the market. However, during bear market, the loss on holding Honda will be expected to be smaller as well.
3 Months Beta |Analyze Honda Motor Demand Trend
Check current 30 days Honda correlation with market (DOW)
β = 0.7796

Honda Central Daily Price Deviation

Honda Motor Technical Analysis

Transformation
The output start index for this execution was zero with a total number of output elements of sixty-one. The Median Price line plots median indexes of Honda Motor price series. View also all equity analysis or get more info about median price price transform indicator.

Honda Projected Return Density Against Market

Considering 30-days investment horizon, Honda has beta of 0.7796 . This indicates as returns on market go up, Honda average returns are expected to increase less than the benchmark. However during bear market, the loss on holding Honda Motor will be expected to be much smaller as well. Moreover, 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 Honda or Driverless Cars 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 Honda stock's 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 Honda 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. The company has an alpha of 0.0633 implying that it can potentially generate 0.0633% excess return over DOW after adjusting for the inherited market risk (beta).
 Predicted Return Density 
      Returns 

Honda Risk Measures

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 Honda or Driverless Cars 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 Honda stock's 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 Honda 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. Considering 30-days investment horizon, the coefficient of variation of Honda is 1008.6. The daily returns are destributed with a variance of 13.97 and standard deviation of 3.74. The mean deviation of Honda Motor is currently at 2.77. For similar time horizon, the selected benchmark (DOW) has volatility of 3.98
α
Alpha over DOW
=0.06
β
Beta against DOW=0.78
σ
Overall volatility
=3.74
Ir
Information ratio =0.0114

Honda Return Volatility

the company has volatility of 3.7377% on return distribution over 30 days investment horizon. the entity inherits 3.8604% risk (volatility on return distribution) over the 30 days horizon.
 Performance (%) 
      Timeline 

About Honda Volatility

Volatility is a rate at which the price of Honda 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 Honda may increase or decrease. In other words, similar to Honda's beta indicator, it measures the risk of Honda and helps estimate the fluctuations that may happen in a short period of time. So if prices of Honda 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 ReportedProjected for 2020
Market Capitalization 43,484,227,411  40,820,000,000 
Honda Motor Co., Ltd. develops, manufactures, and distributes motorcycles, automobiles, power products, and other products worldwide. The company was founded in 1946 and is headquartered in Tokyo, Japan. Honda operates under Auto Manufacturers classification in USA and is traded on BATS Exchange.

Honda Investment Opportunity

DOW has a standard deviation of returns of 3.86 and is 1.03 times more volatile than Honda Motor. 32  of all equities and portfolios are less risky than Honda. Compared to the overall equity markets, volatility of historical daily returns of Honda Motor is lower than 32 () of all global equities and portfolios over the last 30 days. Use Honda Motor to enhance returns of your portfolios. The stock experiences very speculative upward sentiment. . Check odds of Honda to be traded at $35.13 in 30 days. . As returns on market increase, Honda returns are expected to increase less than the market. However, during bear market, the loss on holding Honda will be expected to be smaller as well.

Honda correlation with market

correlation synergy
Very poor diversification
Overlapping area represents the amount of risk that can be diversified away by holding Honda Motor Company Ltd and equity matching DJI index in the same portfolio.

Honda Additional Risk Indicators

The analysis of various secondary risk indicators of Honda is one of the essential steps in making a buy or sell decision. The process involves identifying the amount of risk involved in Honda investment, and either accepting that risk or mitigating it. Along with some common measures of Honda stock 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 your existing portfolio. Please note, the risk measures we provide can be used independently or collectively to perform a risk assessment. When comparing two potential stock investments, we recommend comparing the like to determine which investment holds the most risk.
Risk Adjusted Performance0.1552
Market Risk Adjusted Performance0.1854
Mean Deviation2.78
Semi Deviation3.54
Downside Deviation3.68
Coefficient Of Variation2553.13
Standard Deviation3.75

Honda 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.
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Please check Risk vs Return Analysis. Please also try Probability Of Bankruptcy module to get analysis of equity chance of financial distress in the next 2 years.
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