Correlation Between AWILCO DRILLING and Sun Hung
Can any of the company-specific risk be diversified away by investing in both AWILCO DRILLING and Sun Hung 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 AWILCO DRILLING and Sun Hung into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between AWILCO DRILLING PLC and Sun Hung Kai, you can compare the effects of market volatilities on AWILCO DRILLING and Sun Hung 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 AWILCO DRILLING with a short position of Sun Hung. Check out your portfolio center. Please also check ongoing floating volatility patterns of AWILCO DRILLING and Sun Hung.
Diversification Opportunities for AWILCO DRILLING and Sun Hung
0.15 | Correlation Coefficient |
Average diversification
The 3 months correlation between AWILCO and Sun is 0.15. Overlapping area represents the amount of risk that can be diversified away by holding AWILCO DRILLING PLC and Sun Hung Kai in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Sun Hung Kai and AWILCO DRILLING 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 AWILCO DRILLING PLC are associated (or correlated) with Sun Hung. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Sun Hung Kai has no effect on the direction of AWILCO DRILLING i.e., AWILCO DRILLING and Sun Hung go up and down completely randomly.
Pair Corralation between AWILCO DRILLING and Sun Hung
Assuming the 90 days trading horizon AWILCO DRILLING is expected to generate 3.48 times less return on investment than Sun Hung. But when comparing it to its historical volatility, AWILCO DRILLING PLC is 2.01 times less risky than Sun Hung. It trades about 0.12 of its potential returns per unit of risk. Sun Hung Kai is currently generating about 0.2 of returns per unit of risk over similar time horizon. If you would invest 717.00 in Sun Hung Kai on September 2, 2024 and sell it today you would earn a total of 213.00 from holding Sun Hung Kai or generate 29.71% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
AWILCO DRILLING PLC vs. Sun Hung Kai
Performance |
| Timeline |
| AWILCO DRILLING PLC |
| Sun Hung Kai |
AWILCO DRILLING and Sun Hung Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with AWILCO DRILLING and Sun Hung
The main advantage of trading using opposite AWILCO DRILLING and Sun Hung positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if AWILCO DRILLING position performs unexpectedly, Sun Hung 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 Sun Hung will offset losses from the drop in Sun Hung's long position.| AWILCO DRILLING vs. Apple Inc | AWILCO DRILLING vs. Apple Inc | AWILCO DRILLING vs. Apple Inc | AWILCO DRILLING vs. Apple Inc |
| Sun Hung vs. PUBLIC STORAGE PRFO | Sun Hung vs. AXWAY SOFTWARE EO | Sun Hung vs. Datang International Power | Sun Hung vs. PSI Software AG |
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 Analyst Advice module to analyst recommendations and target price estimates broken down by several categories.
Other Complementary Tools
| Global Correlations Find global opportunities by holding instruments from different markets | |
| Price Exposure Probability Analyze equity upside and downside potential for a given time horizon across multiple markets | |
| Fundamental Analysis View fundamental data based on most recent published financial statements | |
| ETFs Find actively traded Exchange Traded Funds (ETF) from around the world | |
| Portfolio Center All portfolio management and optimization tools to improve performance of your portfolios |