Correlation Between Hasbro and HUTCHMED DRC
Can any of the company-specific risk be diversified away by investing in both Hasbro and HUTCHMED DRC 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 Hasbro and HUTCHMED DRC into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Hasbro Inc and HUTCHMED DRC, you can compare the effects of market volatilities on Hasbro and HUTCHMED DRC 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 Hasbro with a short position of HUTCHMED DRC. Check out your portfolio center. Please also check ongoing floating volatility patterns of Hasbro and HUTCHMED DRC.
Diversification Opportunities for Hasbro and HUTCHMED DRC
0.07 | Correlation Coefficient |
Significant diversification
The 3 months correlation between Hasbro and HUTCHMED is 0.07. Overlapping area represents the amount of risk that can be diversified away by holding Hasbro Inc and HUTCHMED DRC in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on HUTCHMED DRC and Hasbro 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 Hasbro Inc are associated (or correlated) with HUTCHMED DRC. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of HUTCHMED DRC has no effect on the direction of Hasbro i.e., Hasbro and HUTCHMED DRC go up and down completely randomly.
Pair Corralation between Hasbro and HUTCHMED DRC
Considering the 90-day investment horizon Hasbro Inc is expected to generate 0.49 times more return on investment than HUTCHMED DRC. However, Hasbro Inc is 2.05 times less risky than HUTCHMED DRC. It trades about 0.2 of its potential returns per unit of risk. HUTCHMED DRC is currently generating about -0.02 per unit of risk. If you would invest 6,698 in Hasbro Inc on June 8, 2025 and sell it today you would earn a total of 1,275 from holding Hasbro Inc or generate 19.04% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Hasbro Inc vs. HUTCHMED DRC
Performance |
| Timeline |
| Hasbro Inc |
| HUTCHMED DRC |
Hasbro and HUTCHMED DRC Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Hasbro and HUTCHMED DRC
The main advantage of trading using opposite Hasbro and HUTCHMED DRC positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Hasbro position performs unexpectedly, HUTCHMED DRC 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 HUTCHMED DRC will offset losses from the drop in HUTCHMED DRC's long position.The idea behind Hasbro Inc and HUTCHMED DRC 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.| HUTCHMED DRC vs. Collegium Pharmaceutical | HUTCHMED DRC vs. Evotec SE ADR | HUTCHMED DRC vs. I Mab | HUTCHMED DRC vs. Legend Biotech Corp |
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 the Pair Correlation module to compare performance and examine fundamental relationship between any two equity instruments.
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