Correlation Between Brompton Split and Hamilton Enhanced

Can any of the company-specific risk be diversified away by investing in both Brompton Split and Hamilton Enhanced 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 Brompton Split and Hamilton Enhanced into the same portfolio, which is an essential part of the fundamental portfolio management process.

By analyzing existing cross correlation between Brompton Split Corp and Hamilton Enhanced Canadian, you can compare the effects of market volatilities on Brompton Split and Hamilton Enhanced 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 Brompton Split with a short position of Hamilton Enhanced. Check out your portfolio center. Please also check ongoing floating volatility patterns of Brompton Split and Hamilton Enhanced.

Diversification Opportunities for Brompton Split and Hamilton Enhanced

0.99

Correlation Coefficient

Brompton Split  Hamilton Enhanced

No risk reduction

The 3 months correlation between Brompton and Hamilton is 0.99. Overlapping area represents the amount of risk that can be diversified away by holding Brompton Split Corp and Hamilton Enhanced Canadian in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Hamilton Enhanced and Brompton Split 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 Brompton Split Corp are associated (or correlated) with Hamilton Enhanced. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Hamilton Enhanced has no effect on the direction of Brompton Split i.e., Brompton Split and Hamilton Enhanced go up and down completely randomly.

Pair Corralation between Brompton Split and Hamilton Enhanced

Assuming the 90 days trading horizon Brompton Split is expected to generate 1.11 times less return on investment than Hamilton Enhanced. In addition to that, Brompton Split is 1.54 times more volatile than Hamilton Enhanced Canadian. It trades about 0.41 of its total potential returns per unit of risk. Hamilton Enhanced Canadian is currently generating about 0.71 per unit of volatility. If you would invest  2,211  in Hamilton Enhanced Canadian on April 21, 2025 and sell it today you would earn a total of  592.00  from holding Hamilton Enhanced Canadian or generate 26.78% return on investment over 90 days.

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

Brompton Split Corp  vs.  Hamilton Enhanced Canadian

Brompton Split Corp

Risk-Adjusted Performance

Very Strong

Compared to the overall equity markets, risk-adjusted returns on investments in Brompton Split Corp are ranked lower than 32 (%) of all global equities and portfolios over the last 90 days. In spite of very unfluctuating basic indicators, Brompton Split displayed solid returns over the last few months and may actually be approaching a breakup point.

Hamilton Enhanced

Risk-Adjusted Performance

Excellent

Compared to the overall equity markets, risk-adjusted returns on investments in Hamilton Enhanced Canadian are ranked lower than 55 (%) of all global equities and portfolios over the last 90 days. In spite of very unfluctuating basic indicators, Hamilton Enhanced displayed solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with Brompton Split and Hamilton Enhanced

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

The idea behind Brompton Split Corp and Hamilton Enhanced Canadian 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 Stock Tickers module to use high-impact, comprehensive, and customizable stock tickers that can be easily integrated to any websites.