Correlation Between Hydratec Industries and Cardano Impact

Can any of the company-specific risk be diversified away by investing in both Hydratec Industries and Cardano Impact 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 Hydratec Industries and Cardano Impact into the same portfolio, which is an essential part of the fundamental portfolio management process.

By analyzing existing cross correlation between Hydratec Industries NV and Cardano Impact Equity, you can compare the effects of market volatilities on Hydratec Industries and Cardano Impact 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 Hydratec Industries with a short position of Cardano Impact. Check out your portfolio center. Please also check ongoing floating volatility patterns of Hydratec Industries and Cardano Impact.

Diversification Opportunities for Hydratec Industries and Cardano Impact

0.62

Correlation Coefficient

Hydratec Industries  Cardano Impact

Poor diversification

The 3 months correlation between Hydratec and Cardano is 0.62. Overlapping area represents the amount of risk that can be diversified away by holding Hydratec Industries NV and Cardano Impact Equity in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Cardano Impact Equity and Hydratec Industries 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 Hydratec Industries NV are associated (or correlated) with Cardano Impact. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Cardano Impact Equity has no effect on the direction of Hydratec Industries i.e., Hydratec Industries and Cardano Impact go up and down completely randomly.

Pair Corralation between Hydratec Industries and Cardano Impact

Assuming the 90 days trading horizon Hydratec Industries is expected to generate 3.28 times less return on investment than Cardano Impact. In addition to that, Hydratec Industries is 1.25 times more volatile than Cardano Impact Equity. It trades about 0.05 of its total potential returns per unit of risk. Cardano Impact Equity is currently generating about 0.2 per unit of volatility. If you would invest  4,563  in Cardano Impact Equity on April 23, 2025 and sell it today you would earn a total of  656.00  from holding Cardano Impact Equity or generate 14.38% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Together
Strength	Significant
Accuracy	98.41%
Values	Daily Returns

Hydratec Industries NV  vs.  Cardano Impact Equity

Hydratec Industries

Risk-Adjusted Performance

Insignificant

Compared to the overall equity markets, risk-adjusted returns on investments in Hydratec Industries NV are ranked lower than 3 (%) of all global equities and portfolios over the last 90 days. Despite somewhat strong basic indicators, Hydratec Industries is not utilizing all of its potentials. The current stock price disturbance, may contribute to short-term losses for the investors.

Cardano Impact Equity

Risk-Adjusted Performance

Good

Compared to the overall equity markets, risk-adjusted returns on investments in Cardano Impact Equity are ranked lower than 15 (%) of all funds and portfolios of funds over the last 90 days. In spite of comparatively uncertain basic indicators, Cardano Impact unveiled solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with Hydratec Industries and Cardano Impact

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

The idea behind Hydratec Industries NV and Cardano Impact Equity 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 Technical Analysis module to check basic technical indicators and analysis based on most latest market data.