Correlation Between Cloud Air and HJ ShipBuilding
Can any of the company-specific risk be diversified away by investing in both Cloud Air and HJ ShipBuilding 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 Cloud Air and HJ ShipBuilding into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Cloud Air CoLtd and HJ ShipBuilding Construction, you can compare the effects of market volatilities on Cloud Air and HJ ShipBuilding 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 Cloud Air with a short position of HJ ShipBuilding. Check out your portfolio center. Please also check ongoing floating volatility patterns of Cloud Air and HJ ShipBuilding.
Diversification Opportunities for Cloud Air and HJ ShipBuilding
0.02 | Correlation Coefficient |
Significant diversification
The 3 months correlation between Cloud and 097230 is 0.02. Overlapping area represents the amount of risk that can be diversified away by holding Cloud Air CoLtd and HJ ShipBuilding Construction in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on HJ ShipBuilding Cons and Cloud Air 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 Cloud Air CoLtd are associated (or correlated) with HJ ShipBuilding. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of HJ ShipBuilding Cons has no effect on the direction of Cloud Air i.e., Cloud Air and HJ ShipBuilding go up and down completely randomly.
Pair Corralation between Cloud Air and HJ ShipBuilding
Assuming the 90 days trading horizon Cloud Air CoLtd is expected to under-perform the HJ ShipBuilding. But the stock apears to be less risky and, when comparing its historical volatility, Cloud Air CoLtd is 3.82 times less risky than HJ ShipBuilding. The stock trades about 0.0 of its potential returns per unit of risk. The HJ ShipBuilding Construction is currently generating about 0.47 of returns per unit of risk over similar time horizon. If you would invest 225,500 in HJ ShipBuilding Construction on August 29, 2024 and sell it today you would earn a total of 181,500 from holding HJ ShipBuilding Construction or generate 80.49% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 95.65% |
| Values | Daily Returns |
Cloud Air CoLtd vs. HJ ShipBuilding Construction
Performance |
| Timeline |
| Cloud Air CoLtd |
| HJ ShipBuilding Cons |
Cloud Air and HJ ShipBuilding Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Cloud Air and HJ ShipBuilding
The main advantage of trading using opposite Cloud Air and HJ ShipBuilding positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Cloud Air position performs unexpectedly, HJ ShipBuilding 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 HJ ShipBuilding will offset losses from the drop in HJ ShipBuilding's long position.| Cloud Air vs. SK Hynix | Cloud Air vs. LX Semicon Co | Cloud Air vs. Tokai Carbon Korea | Cloud Air vs. People Technology |
| HJ ShipBuilding vs. Cloud Air CoLtd | HJ ShipBuilding vs. Nable Communications | HJ ShipBuilding vs. iNtRON Biotechnology | HJ ShipBuilding vs. Tway Air Co |
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 Global Markets Map module to get a quick overview of global market snapshot using zoomable world map. Drill down to check world indexes.
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